-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 EMl1qXEl08g79fyXsvn07Kc/tZEwagbjYxozRtx6jWFKeKP7CYU+IO2WHtxlOxSv
 hNjo6aUiN2JMHbA6YcO62A==

<SEC-DOCUMENT>0000078150-06-000039.txt : 20060808
<SEC-HEADER>0000078150-06-000039.hdr.sgml : 20060808
<ACCEPTANCE-DATETIME>20060808063136
ACCESSION NUMBER:		0000078150-06-000039
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20060630
FILED AS OF DATE:		20060808
DATE AS OF CHANGE:		20060808

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PHILIPPINE LONG DISTANCE TELEPHONE CO
		CENTRAL INDEX KEY:			0000078150
		STANDARD INDUSTRIAL CLASSIFICATION:	TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-03006
		FILM NUMBER:		061010883

	BUSINESS ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
		BUSINESS PHONE:		0116328143552

	MAIL ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>pldt6k2q2006.htm
<DESCRIPTION>PLDT 2Q 2006 RESULTS
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- -->

</head>

<body style='font-family:arial,helvetica,sans-serif;font-size:9pt'  lang=EN-US link=blue vlink=purple>

<div>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>SECURITIES AND EXCHANGE COMMISSION</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Washington</b><b>,
 D.C.</b><b>  20549</b></p>

<p style='margin-top:0in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>FORM 6 -K</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Report of Foreign Private Issuer</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Pursuant to Rule 13a-16 or 15d-16 </b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Of the Securities Exchange Act of 1934</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>For the month of August 2006, which
includes financial statements <br>
for the six months ended June 30, 2006 </b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Commission File Number 1-03006</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Philippine Long Distance Telephone Company</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Exact Name of Registrant as specified in its Charter)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Ramon</b><b> Cojuangco Building</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Makati Avenue</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Makati</b><b> City</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Philippines</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Address of principal executive offices)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify' style="margin-top:0;margin-bottom:0">(Indicate by check mark whether the registrant files
or will file annual reports under cover of Form 20-F or Form 40-F.)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:144.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Form
 20-F:  &#8730;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Form
 40-F:</p>
 </td>
 </tr>
</table></center></div>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify' style="margin-top:0;margin-bottom:0">(Indicate by check mark whether by furnishing the
information contained in this form, the registrant is also thereby furnishing
the information to the commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act 1934.)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:144.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Yes:
 </p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">No:
 &#8730;</p>
 </td>
 </tr>
</table></center></div>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify' style="margin-top:0;margin-bottom:0">(If &#147;Yes&#148; is marked, indicate below the file number
assigned to the registrant in connection with Rule 12g3-2(b):  82-_____)</p>

</div>

<b><br clear=all
style='page-break-before:always'>
</b>

<div>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF </p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">FINANCIAL CONDITION AND RESULTS OF OPERATIONS</p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">For the Six Months Ended June 30, 2006</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>In
the following discussion and analysis of our financial condition and results of
operations, unless the context indicates or otherwise requires, references to
&#147;we,&#148; &#147;us,&#148; &#147;our&#148; or &#147;PLDT Group&#148; mean the Philippine Long Distance Telephone
Company and its consolidated subsidiaries, and references to &#147;PLDT&#148; mean the
Philippine Long Distance Telephone Company, not including its consolidated
subsidiaries (see Note 2 &#150; Summary of Significant Accounting Policies and
Practices to the accompanying unaudited consolidated financial statements for a
list of these subsidiaries, including a description of their respective
principal business activities).</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>The
following discussion and analysis of our financial condition and results of
operations should be read in conjunction with the accompanying unaudited
consolidated financial statements and the related notes.  Our financial
statements, and the financial information discussed below, have been prepared
in accordance with Philippine generally accepted accounting principles, or
Philippine GAAP, which differ in certain significant respects from generally
accepted accounting principles in the United States.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>The
financial information appearing in this report and in the accompanying unaudited
consolidated financial statements is stated in Philippine pesos.  All
references to &#147;pesos,&#148; &#147;Philippine pesos&#148; or &#147;Php&#148; are to the lawful currency
of the Philippines; all references to &#147;U.S. dollars,&#148; &#147;US$&#148; or &#147;dollars&#148; are to
the lawful currency of the United States; all references to &#147;Japanese yen,&#148;
&#147;JP&yen;&#148; or &#147;&yen;&#148; are to the lawful currency of Japan</i> <i>and all references to &#147;Euro&#148; or &#147;&#128;&#148; are to the
lawful currency of the European Union</i><i>.  Translations of Philippine peso
amounts into U.S. dollars in this report and in the accompanying unaudited
consolidated financial statements were made based on the exchange rate of Php53.220
to US$1.00, the volume weighted average exchange rate at June 30, 2006 quoted
through the Philippine Dealing System.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Some
information in this report may contain forward-looking statements within the
meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of
the U.S. Securities Exchange Act of 1934.  We have based these forward-looking
statements on our current beliefs, expectations and intentions as to facts,
actions and events that will or may occur in the future.  Such statements
generally are identified by forward-looking words such as &#147;believe,&#148; &#147;plan,&#148;
&#147;anticipate,&#148; &#147;continue,&#148; &#147;estimate,&#148; &#147;expect,&#148; &#147;may,&#148; &#147;will&#148; or other similar
words.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>A
forward-looking statement may include a statement of the assumptions or bases
underlying the forward-looking statement.  We have chosen these assumptions or
bases in good faith, and we believe that they are reasonable in all material
respects.  However, we caution you that forward-looking statements and assumed
facts or bases almost always vary from actual results, and the differences
between the results implied by the forward-looking statements and assumed facts
or bases and actual results can be material, depending on the circumstances.
When considering forward-looking statements, you should keep in mind the
description of risks and cautionary statements in this report.  You should also
keep in mind that any forward-looking statement made by us in this report or
elsewhere speaks only as at the date on which we made it.  New risks and
uncertainties come up from time to time, and it is impossible for us to predict
these events or how they may affect us.  We have no duty to, and do not intend
to, update or revise the forward-looking statements in this report after the
date hereof.  In light of these risks and uncertainties, any forward-looking
statement made in this report or elsewhere might not occur.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Financial Highlights and Key Performance Indicators</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.38%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>June 30,</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>December 31,</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.2pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.2pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:.2pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in millions, except for operational data, exchange
 rates and earnings per common share)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Audited)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Consolidated Balance Sheets</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.2in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php244,771</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php249,713</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(Php4,942)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Property, plant and equipment </p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">173,832</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">176,974</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3,142)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:22.5pt;margin-bottom:.0001pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cash and cash equivalents and short-term
 investments</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">29,138</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">32,810</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3,672)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-left:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total equity</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">85,870</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">74,369</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">11,501</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">101,642</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">116,616</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(14,974)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Notes payable
 and long-term debt</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>90,691</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>103,544</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><i>(12,853)</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>(12)</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net debt to equity ratio(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">0.72x</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">0.95x</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;line-height:
 7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 line-height:7.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30, </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:3.65pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;text-indent:13.8pt' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Consolidated Statements of Income</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Revenues and other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php62,361</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php61,138</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,223</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">43,736</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">39,103</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,633</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">18,625</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">22,035</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,410)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income attributable to equity
 holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,306</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,214)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;text-indent:
 13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net income</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,639</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(913)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;text-indent:
 13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net income
 margin</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">25%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">27%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;text-indent:
 13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Earnings per
 common share &#150; basic</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">83.02</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">92.44</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(9.42)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(10)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Consolidated Statements of Cash Flows
 </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash provided by operating
 activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">33,601</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">35,151</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,550)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash used in investing activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,898</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,220</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">11,678</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">526</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:22.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>Capital expenditures</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>12,385</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>7,012</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>5,373</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>77</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash used in financing activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,943</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">24,528</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(585)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Operational
 Data</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of cellular subscribers</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,465,156</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">20,789,469</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,675,687</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of fixed lines in service</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,070,721</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,137,813</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(67,092)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of broadband subscribers</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">173,693</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">66,877</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">106,816</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">160</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Fixed Line</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>115,867</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>64,824</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>51,043</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>79</i></p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wireless</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>57,826</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>2,053</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>55,773</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>2,717</i></p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of employees</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,618</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">18,649</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,969</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr style='height:.15in' style='height:.15in !msorm'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Fixed Line</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>9,149</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>9,582</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>(433)</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>(5)</i></p>
 </td>
 </tr>
 <tr style='height:.15in' style='height:.15in !msorm'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wireless</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>5,189</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>5,156</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>33</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>1</i></p>
 </td>
 </tr>
 <tr style='height:.15in' style='height:.15in !msorm'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>ICT</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>6,280</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>3,911</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>2,369</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>61</i></p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:347.4pt;border-collapse:collapse'>
 <tr style='height:10.7pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.7pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Exchange Rates</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:10.7pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Php per US$</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.7pt'>
 <p align=center style='margin-left:13.7pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:10.7pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Php per JP&yen;</b></p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">June 30, 2006</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php53.220</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php0.4650</p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><a name="_Hlk112036701">December 31,
 2005</a></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.062</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.4504</p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">June 30, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.177</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.5067</p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">December 31, 2004</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.341</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.5495</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">______________</p>

<p style=';line-height:2.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Net debt is derived by
deducting cash and cash equivalents and short-term investments from long-term
debt. </i></p>

<p style='text-align:justify;text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><a
name="_Toc6822633"></a><a name="_Toc520601088"></a><a name="_Toc520103169">&nbsp;</a></p>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>Overview</b></p>

<p style='text-align:justify;text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">We are the largest and
most diversified telecommunications company in the Philippines.  We have
organized our business into three main segments:</p>

<p style='text-align:justify;text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Wireless </i><i>&#151;</i><i> </i>wireless
telecommunications services provided by Smart Communications, Inc., or Smart,
and Pilipino Telephone Corporation, or Piltel, our cellular service providers; Smart
Broadband, Inc., or Smart Broadband (formerly
known as Meridian Telekoms, Inc., or Meridian), our wireless broadband
provider; Wolfpac Mobile, Inc., or Wolfpac, our wireless content operator,
Mabuhay Satellite Corporation, or Mabuhay Satellite, ACeS Philippines Cellular
Satellite Corporation, or ACeS Philippines, and Telesat, Inc., or Telesat, our
satellite and very small aperture terminal, or VSAT, operators;<i> </i></p>

<p style='text-align:justify;text-indent:.5in;line-height:9.0pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Fixed Line </i><i>&#151;</i><i> </i>fixed line
telecommunications services are primarily provided through PLDT.  We also
provide fixed line services through PLDT&#146;s subsidiaries PLDT Clark Telecom,
Inc., Subic Telecommunications Company, Inc., PLDT-Maratel, Inc., Piltel and
Bonifacio Communications Corporation, which together account for approximately
3% of our consolidated fixed lines in service, and PLDT Global Corporation, or
PLDT Global; and</p>

<p style='text-align:justify;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Information and Communications
Technology </i><i>&#151;</i><i> </i>information
and communications infrastructure and services for Internet applications, Internet
protocol-based solutions and multimedia content delivery provided by PLDT&#146;s
subsidiary ePLDT, Inc., or ePLDT; call center services provided under one
umbrella brand name <i>ePLDT Ventus</i>, including Parlance Systems, Inc., or
Parlance and Vocativ Systems, Inc., or Vocativ; Internet access and gaming
services provided by ePLDT&#146;s subsidiaries, Infocom Technologies, Inc. or
Infocom, Digital Paradise, Inc., or Digital Paradise, Digital Paradise
Thailand, Ltd., or Digital Paradise Thailand, netGames, Inc., or netGames, Airborne
Access Corporation, or Airborne Access and Level Up!, Inc., or Level Up!; and
e-commerce, and IT-related services provided by other investees of ePLDT, as
discussed in <i>Note 9 &#150; Investments in Associates</i> to the accompanying unaudited
consolidated financial statements. </p>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">We registered total
revenues and other income of Php62,361 million in the first half of 2006, an increase
of Php1,223 million, or 2%, as compared to Php61,138 million in the same period
in 2005 primarily due to an increase in our service revenues and other income
of Php1,097 million and Php165 million, respectively, partially offset by a decline
in our non-service revenues of Php39 million.  </p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Expenses increased by
Php4,633 million, or 12%, to Php43,736 million in the first half of 2006 from
Php39,103 million in the same period in 2005, largely resulting from increases
in depreciation and amortization, and financing costs partly offset by lower
cost of sales.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As a result of the
foregoing, net income attributable to equity holders of PLDT decreased by Php1,214
million, or 7%, to Php15,306 million in the first half of 2006 from Php16,520
million in the same period in 2005.  Consequently, basic earnings per common share
decreased by 10% to Php83.02 in the first half of 2006 from Php92.44 in the
same period in 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>Results of Operations </b></p>

<p style='text-align:justify;text-indent:.5in;line-height:8.0pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table below shows the contribution by each of our
business segments to our revenues and other income, expenses and net income for
the six months ended June 30, 2006 and 2005.  Most of our revenues are derived
from our operations within the Philippines.</p>

<p style='text-align:justify;text-indent:.5in;line-height:6.0pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:118.36%;;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>ICT</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Inter-segment
 Transactions</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>For the six months ended <br>
 June 30, 2006 </b>(Unaudited)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues and other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php39,912</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php24,318</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,011</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php3,880)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php62,361</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,591</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,053</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,812</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,816)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">60,640</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,188</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">172</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,383</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:45.0pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Equity share in net income of associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">229</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(51)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">335</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21,658</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,022</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,936</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,880)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">43,736</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,254</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">296</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,625</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:4.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,301</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">251</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">87</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,639</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income attributable to <br>
 equity holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,927</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">251</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">128</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,306</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>For the six months ended <br>
 June 30, 2005</b> (Unaudited)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues and other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37,831</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,336</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,587</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,616)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61,138</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36,483</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,235</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,328</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,503)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">59,543</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,291</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">215</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(84)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,422</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:45.0pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Equity share in net income of associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:.25in;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">101</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(29)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,305</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,896</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,518</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,616)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">39,103</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,526</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,440</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">69</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,035</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.4pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p style='margin-left:4.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,330</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,159</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income attributable to <br>
 equity holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,279</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,158</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">83</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.4pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p style='margin-left:4.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues and other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,081</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php18)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php424</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,264)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,223</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,108</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(182)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">484</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,313)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,097</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(103)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(20)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(39)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">76</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">128</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">127</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(41)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">165</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,353</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,126</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">418</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,264)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,633</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">728</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,144)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(93)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,410)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,971</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,908)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(92)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:10.1pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(913)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income attributable to<br>
  equity holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,648</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,907)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(92)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:10.1pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,214)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK13"></a><a name="OLE_LINK1"><b>Wireless</b></a></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Revenues and Other Income</h3>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our wireless business segment offers cellular services
as well as wireless broadband, satellite, VSAT and other services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes our service and
non-service revenues and other income from our wireless business for the six months
ended June 30, 2006 and 2005 by service segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:99.36%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 <td style='border:none;padding:0in 0in 0in 0in'  ><p style="margin-top:0;margin-bottom:0">&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 <td style='border:none;padding:0in 0in 0in 0in'  ><p style="margin-top:0;margin-bottom:0">&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 <td style='border:none;padding:0in 0in 0in 0in'  ><p style="margin-top:0;margin-bottom:0">&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:13.2pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php37,076</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,233</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,843</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:40.5pt;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless broadband, satellite, VSAT and
 others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,515</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,250</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">265</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,591</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36,483</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">96</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,108</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;padding:
 0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Sale
 of cellular handsets and SIM-packs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,188</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,291</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(103)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Other Income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">76</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:1.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 Wireless Revenues and Other Income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php39,912</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php37,831</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,081</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:1.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:1.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our wireless service
revenues increased by Php2,108 million, or 6%, to Php38,591 million in the
first half of 2006 compared to Php36,483 million in the same period in 2005,
mainly as a result of the growth of Smart&#146;s and Piltel&#146;s subscriber base, an
increase in international inbound revenues and reductions in domestic interconnection
costs due to a shift from off-network to on-network voice and data usage.  As a
percentage of our total wireless revenues and other income, service revenues increased
to 97% in the first half of 2006 compared to 96% in the same period in 2005. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Cellular Service</i></p>

<p style='margin-left:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our cellular service revenues consist of: </p>

<p style='margin-left:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from actual usage
of the network by prepaid subscribers and any unused peso value of expired
prepaid cards or electronic air time loads, net of content costs and discounts
given to dealers; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees from postpaid
subscribers, including (1) charges for calls in excess of allocated free local
calls, (2) toll charges for national and international long distance calls, (3)
charges for text messages of our service customers in excess of allotted free
text messages, and (4) charges for value-added services, net of related content
provider costs;</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from incoming
calls and messages to our subscribers, net of interconnection expenses; fees
from reciprocal traffic from international correspondents; and revenues from
inbound international roaming calls for the service; and</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
other charges, including those for
reconnection and migration. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our cellular service
revenues in the first half of 2006 amounted to Php37,076 million, an increase
of Php1,843 million, or 5%, from Php35,233 million in the same period in 2005.
Cellular service revenues accounted for 96% and 97% of our wireless service revenues
in the first half of 2006 and 2005, respectively.  </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006,
Smart and Piltel cellular subscribers reached 22,465,156, an increase of 1,675,687,
or 8%, over their combined cellular subscriber base of 20,789,469 as at June 30,
2005.  Prepaid subscribers accounted for 99% of our total subscriber base as at
June 30, 2006 and 2005.  Prepaid and postpaid subscribers totaled 22,168,122
and 297,034 as at June 30, 2006, reflecting net subscriber activations of 2,039,579
and 16,956, respectively, in the first half of 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
markets nationwide cellular communications services under the brand names <i>Smart
Buddy, Smart Gold,</i> <i>addict mobile,</i> <i>addict mobile prepaid</i>, or <i>amp</i>,
<i>Smart Infinity </i>and<i> Smart Kid prepaid.  Smart Buddy, amp </i>and <i>Smart
Kid prepaid</i> are prepaid services while <i>Smart Gold, Smart Infinity</i>
and <i>addict mobile</i> are postpaid services, which are all provided through
Smart's digital network.  Piltel markets
its cellular prepaid service under the brand name <i>Talk &#145;N Text</i> which is
provided through Smart&#146;s network.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Beginning
March 11, 2005, Smart launched a series of promotions to test the market demand
for fixed rate or &#147;bucket&#148; plans for voice and text services.  Under a service
branded as <i>Smart 258</i>, Smart and <i>Talk &#145;N Text</i> subscribers had the option
to register for unlimited on-network
(Smart-to-Smart) voice calls or unlimited on-network (Smart-to-Smart) text
messaging service.  Since launch, the promotion has taken on several variations
involving changes in load denominations, the periods of network availability
(peak/off-peak) as well as a &#147;double text&#148; variation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
current <i>Smart 258</i><i> </i>promotion has the following
features: </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unlimited Text &#150; Php15, Php30 and
Php60 denominations with expiry periods of one, two and four days,
respectively, with unlimited on-network text all day service; and</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Text and Call Combo &#150; Php20 load
denomination with unlimited text on-network for one day and a call with a
maximum duration of five minutes valid within 24 hours. </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 23, 2005, Smart introduced a flat rate promotion which allows Smart and <i>Talk
&#145;N Text</i> prepaid subscribers to make a call to another Smart or<i> Talk &#145;N
Text</i> subscriber of up to three minutes for Php10, or extend up to five
minutes for a flat rate of Php15.  The flat rate promotion was relaunched on
February 11, 2006 and has been extended until August 10, 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
February 14, 2006, Smart launched its 3G service on a free-trial basis.
Subscribers using Smart&#146;s network with 3G handsets in selected key areas could
avail of services such as video calling, video streaming, high-speed Internet
browsing and special 3G content downloading under Smart&#146;s 3G network.
Commercial rates were introduced on May 1, 2006 along with new and expanded 3G
services.  As at June 30, 2006, we offered the following rates for our service:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Smart-to-Smart video calls are
charged Php6.50 per call (same as voice calls) while international video calls,
initially available in three countries, are priced similarly to a regular IDD
call at US$0.40 per minute;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
all 3G video and audio streaming
are charged a Php15 access fee for every 30 minutes plus a separate fee for
content;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3G Internet and WAP browsing are
priced at Php10 for every 30 minutes;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
downloads of 3G content such as
video clips, ringtones, visual ringers and games range from Php20 to Php50 per
download; and</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Php1 per MMS for MMS among all
Smart subscribers and Php2 for Smart-to-other networks.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">On April 1, 2006,
Smart rolled out <i>Smart Click</i>, a chain of mobile Internet caf&#233;s.  <i>Smart
Click</i> Internet caf&#233;s are currently housed in air-conditioned 40-foot
container vans and designed to provide remote communities with high-speed,
wireless Internet access nationwide.  <i>Smart Click</i> has established 18
mobile Internet caf&#233;s to-date. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On April 23, 2006, Smart introduced a new variety of
top-ups &#150; <i>Smart Load</i> &#147;All Text,&#148; which allows 10 and 20 messages without
expiration for a suggested retail price of Php12 and Php23, respectively.  On
May 1, 2006, the number of messages allocated for the 10-message load was
increased to 15.  This promotion offering the additional five messages has been
extended until June 30, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
June 25, 2006, Smart launched another variety of top-ups called <i>Unli </i>(short
for &#147;unlimited&#148;).  <i>Unli</i> allows for unlimited on-network texting without
need for registration.  The <i>Unli 30</i> has a Php30 load denomination with
an expiration period of two days.  The <i>Unli 40</i> load denomination offers
unlimited on-network texting plus five additional on-network/off-network SMS
and two three-minute Smart-to-Smart calls and is also valid for two days.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes key measures of our
cellular business as at and for the six months ended June 30, 2006 and 2005:</p>

<p style='margin-left:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.04%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=12 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   colspan=12 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.2pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='height:11.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cellular service
 revenues </p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php37,076</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,233</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,843</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>By component </i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>36,096</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>34,331</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>1,765</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>5</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:27.0pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Voice </p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,343</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,890</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">453</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:27.0pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Data</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,753</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,441</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,312</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:31.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>By service type</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>36,096</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>34,331</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>1,765</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>5</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:27.0pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Prepaid</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">33,693</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32,224</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,469</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:27.0pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,403</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,107</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">296</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 </tr>
 <tr style='height:4.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:31.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><i>Others</i>(1)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>980</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>902</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>78</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>9</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:18.05pt;margin-bottom:
 0in;margin-left:4.5pt;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">______________</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='line-height:1.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Refers to other
non-subscriber-related revenues consisting primarily of inbound international
roaming fees, revenues from Smart&#146;s public calling offices and payphone
businesses, revenues from Wolfpac and Smart Money Holdings Corporation and a
small number of leased line contracts. </i></p>

<p style='line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.04%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular subscriber base </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,465,156</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,789,469</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,675,687</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Prepaid </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,168,122</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,521,216</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,646,906</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,107,431</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,556,780</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">550,651</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,060,691</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,964,436</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,096,255</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">297,034</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">268,253</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,781</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June
 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b>(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Systemwide traffic volumes (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Calls (in minutes) </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,832</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,647</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">185</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:22.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Domestic  </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,769</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,912</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(143)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:22.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">International</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,063</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">735</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">328</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:31.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">982</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">649</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">333</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:31.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">81</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">86</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Text messages </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Standard</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,008</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,778</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,770)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>258</i> Unlimited </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">91,851     </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,829</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">78,022</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">564</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.5in;text-indent:-.5in' style="margin-top:0;margin-bottom:0">__________</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)   Smart 258</i><i> Unlimited Call and Text promotion was launched on
March 11, 2005.</i></p>

<p style='margin-left:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Voice
Services</i></p>

<p style='margin-left:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Cellular revenues from
voice services, which include all voice traffic and voice value-added services
such as voice mail and international roaming, increased by Php453 million to
Php17,343 million in the first half of 2006 from Php16,890 million in the same
period in 2005 primarily due to an increase in international inbound revenue
partly offset by a decrease in domestic voice revenues.  The decline in
domestic voice revenue may be attributed to the shift of certain subscribers to
bucket plans or unlimited text service due to its economic advantages.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.5in' style="margin-top:0;margin-bottom:0">Air time rates for postpaid subscribers vary depending on the
type of postpaid plan selected by subscribers.  </p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Data Services</i></p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cellular
revenues from data services, which
include all text messaging-related services as well as value-added services,
increased by Php1,312 million, or 8%, to Php18,753 million in the first half of
2006 from Php17,441 million in the same period in 2005.  Cellular data services
accounted for 51% of cellular service revenues in the first half of 2006,
compared to 50% in the same period in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows the breakdown of cellular
data revenues for the six months ended June 30, 2006 and 2005:</p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Text messaging</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Domestic </p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php16,235</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php14,832</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,403</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:22.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Standard </p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,854</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,749</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,895)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(21)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:22.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>258</i>
 Unlimited</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,381</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,083</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,298</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">397</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">International</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">853</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">856</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,088</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,688</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,400</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Value-added services</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-Zed(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,135</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,138</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Smart Zed</i>TM
 </p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">185</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">287</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(102)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(36)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Smart Money</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(34)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Mobile Banking</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Roaming SMS and WAP<i> </i></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">311</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">279</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,665</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,753</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(88)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php18,753</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php17,441</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php1,312</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_________________</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)   Value-added services
developed by Smart on its own platform.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Text
messaging-related services contributed revenues of Php17,088 million in the
first half of 2006, an increase of Php1,400 million, or 9%, compared to Php15,688
million in the same period in 2005, and accounted for 91% and 90% of the total
cellular data revenues in the first half of 2006 and 2005, respectively.  The
increase in revenues from text messaging-related services resulted mainly from the
ongoing <i>Smart 258</i><i> Unlimited Text</i><i> </i>promotion and an increase in<i>
Pasa Load</i> transactions.  Text messaging revenues from the <i>Smart </i><i>258</i>
promotions totaled Php5,381 million.  Value-added services, which contributed
revenues of Php1,665 million in the first half of 2006, decreased by Php88
million from Php1,753 million in the same period in 2005 primarily due to decreased
usage of <i>Smart Zed</i> and <i>Smart Money </i>services, partially offset by higher
usage of roaming SMS and WAP in the first half of 2006 as compared to the same
period in 2005.  The decline in <i>Smart Zed</i> usage was due to increased
competition from other content providers while the recent restriction on text
broadcasting imposed by the NTC to all cellular operators resulted in a decline
in both <i>Zed</i> and non-Zed revenues.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Standard
text messages totaled 18,008 million in the first half of 2006, a decrease of 2,770
million, or 13%, from 20,778 million in the same period in 2005 due to a shift
to unlimited texting service.  <i>Smart
258</i> messages in the first half of 2006 totaled 91,851
million, an increase of 78,022 million as compared to 13,829 million in the
same period in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Subscriber Base, ARPU and Churn Rates</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">Prepaid subscribers accounted for approximately 99%
of our 22,465,156 subscribers as at June 30, 2006, while postpaid subscribers
accounted for the remaining 1%.  The cellular prepaid subscriber base grew by 8%
to 22,168,122 as at June 30, 2006 from 20,521,216 as at June 30, 2005, whereas the
postpaid subscriber base increased by 11% to 297,034 as at June 30, 2006 from 268,253
as at June 30, 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our net subscriber activations (reductions) for the six
months ended June 30, 2006 and 2005 were as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:427.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:.05in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,039,579</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,587,478</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">452,101</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">963,313</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,235,492</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(272,179)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,076,266</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">351,986</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">724,280</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">206</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,956</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,241)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,197</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">372</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td  style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,056,535</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,581,237</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">475,298</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Revenues attributable to our cellular prepaid
service amounted to Php33,693 million in the first half of 2006, a 5% increase
over the Php32,224 million earned in the same period in 2005.  Prepaid service
revenues in the first half of 2006 and 2005 accounted for 93% and 94%,
respectively, of voice and data revenues.  Revenues attributable to Smart&#146;s
postpaid service amounted to Php2,403 million in the first half of 2006, a 14% increase
over the Php2,107 million earned in the same period in 2005 and accounted for 7%
and 6% of voice and data revenues in the first half of 2006 and 2005,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes our cellular ARPUs for
the six months ended June 30, 2006 and 2005:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:105.12%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=23 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June
 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.95pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Gross</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Net</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.15pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.15pt'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:.05pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:.45pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.15pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.15pt'>
 <p align=center style='margin-right:.15in;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.15pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.15pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;text-indent:
 4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=23 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.5pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=6 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php350</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php357</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php7)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php294</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php292</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">239</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">266</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(10)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">216</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(12)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid &#150;
 Blended</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">321</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">335</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">271</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">274</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Postpaid &#150; Smart</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,893</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,831</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">62</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,400</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,308</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Prepaid and Postpaid Blended</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">342</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">355</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">286</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">287</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
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 <td  style='border:none'></td>
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 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">ARPU is computed for
each month by dividing the revenues for the relevant services for the month by
the average of the number of subscribers at the beginning and at the end of the
month.  Gross monthly ARPU is computed by dividing the revenues for the
relevant services, gross of dealer discounts and allocated content-provider
costs, including interconnection income but excluding inbound roaming revenues,
by the average number of subscribers.  Net monthly ARPU, on the other hand, is
calculated based on revenues net of dealer discounts and allocated
content-provider costs and interconnection income net of interconnection
expense.  ARPU for any period of more than one month is calculated as the
simple average of the monthly ARPUs in that period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Prepaid
service revenues consist mainly of charges for subscribers' actual usage of
their loads.  Gross monthly ARPU for Smart prepaid subscribers in the first half
of 2006 was Php350, a decrease of 2%, compared to Php357 in the same period in
2005.  The average outbound local and international voice revenue per
subscriber declined in the first half of 2006 compared to the same period in
2005, but was offset by an increase in the average text messaging revenue and
inbound international revenue per subscriber.  On a net basis, ARPU in the
first half of 2006 increased by 1% to Php294 from Php292 in the same period in
2005 due to lower domestic interconnection expense resulting from increased
on-network voice and text usage.  Gross monthly ARPU for <i>Talk &#145;N Text</i>
subscribers in the first half of 2006 was Php239, a decrease of 10% compared to
Php266 in the same period in 2005.  The
decline was attributable to the decrease in the average outbound local voice
revenue per subscriber as well as the average inbound revenue per subscriber
partly offset by an increase in the average text messaging revenue per
subscriber.  On a net basis, ARPU in the
first half of 2006 decreased by 6% to Php204 from Php216 in the same period in 2005.
</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Monthly ARPU for
Smart&#146;s postpaid services is calculated in a manner similar to that of prepaid
service, except that the revenues consist mainly of monthly service fees and
charges on usage in excess of the monthly service fees.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Gross monthly ARPU for
postpaid subscribers increased by 3% to Php1,893 while net monthly ARPU
increased by 7% to Php1,400 in the first half of 2006 as compared to Php1,831
and Php1,308 in the same period in 2005, respectively.  Prepaid and postpaid
monthly gross blended ARPU was Php342 in the first half of 2006, a decrease of 4%
compared to Php355 in the same period in 2005.  Monthly net blended ARPU remained
stable at Php286 in the first half of 2006 compared to Php287 in the same
period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Our quarterly prepaid and postpaid ARPUs
for the six months ended June 30, 2006 and 2005 were as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:459.0pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Prepaid</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Postpaid</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Smart</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Piltel</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Smart</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Gross</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Net</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Gross</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Net</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Gross</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Net</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=11 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php356</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php294</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php245</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php207</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,867</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,386</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Second Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">344</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">294</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">234</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">202</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,920</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,414</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php356</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php289</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php269</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php220</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,767</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,257</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Second Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">357</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">294</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">262</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">212</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,896</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,360</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Third Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">343</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">285</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">234</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">194</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,889</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,389</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fourth Quarter</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">370</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">308</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">261</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">220</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,923</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,467</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Churn, or the rate at which existing subscribers have
their service cancelled in a given period, is computed based on total disconnections
in the period, net of reconnections in the case of postpaid subscribers,
divided by the average of the number of subscribers at the beginning and at the
end of a month, all divided by the number of months in the same period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Prior
to June 2004, a prepaid cellular subscriber was recognized as an active
subscriber when that subscriber activated and used the SIM card in the handset,
which contained pre-stored air time.  The pre-stored air time, which can be
used for both voice and text, was reduced from Php100 to Php50 in April 2004.
In May 2005, this was changed to Php1 plus 50 free SMS which could only be used
upon purchase or reload of air time of any value.  Subscribers can reload their
air time by purchasing prepaid &#147;call and text&#148; cards; by purchasing additional
air time &#147;over the air&#148; via <i>Smart</i> <i>Load</i> or <i>Smart Load</i> &#147;All
Text&#148;; and by receiving loads of Php2, Php5, Php10 and Php15 via <i>Pasa</i> <i>Load</i>,
or through their handsets using <i>Smart Money</i>.  Reloads have validity
periods ranging from one day to two months, depending on the amount reloaded.
A prepaid cellular subscriber is disconnected if the subscriber does not reload
within four months after the full usage or expiry of the last reload.  Our
current policy is to recognize a prepaid subscriber as &#147;active&#148; only when the
subscriber activates and uses the SIM card and reloads at least once during the
month of initial activation or in the immediate succeeding month.  For example,
if a customer activated a SIM card in April but had not reloaded by May 31,
this customer would not be counted as a subscriber.  The rationale for this
change stems from our observance of &#147;SIM-swapping&#148; activities in the market.  &#147;SIM-swapping&#148;
refers to the promotional activity wherein subscribers can exchange their
current prepaid SIM card for another operator&#146;s SIM card at no cost to the
subscriber.  We believe that these activities have given rise to a situation
where certain subscribers swap their SIM cards between mobile operators upon
full usage of the pre-stored air time, which may result in our subscriber base
reflecting a certain number of transient subscribers at any one point in time.
In May 2005, we terminated our &#147;SIM swapping&#148; promotions; as a result, our
churn rates increased in the third and fourth quarters of 2005 but tapered off
beginning the first quarter of 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For Smart
prepaid, the average monthly churn rate for the first half of 2006 was 2.9%
compared to 3.4% in the same period in 2005, while the average monthly churn
rate for <i>Talk &#145;N Text</i> subscribers was 3.3% in the first half of 2006
compared to 4.6% in the same period in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">The average monthly
churn rate for Smart's postpaid subscribers for the first half of 2006 was 1.3%
compared to 2.3% in the same period in 2005.  Smart's policy is to redirect
outgoing calls to an interactive voice response system if the postpaid
subscriber's account is either 45 days overdue or the subscriber has exceeded
the prescribed credit limit.  If the subscriber does not make a payment within
44 days of redirection, the account is disconnected.  Within this 44-day
period, a series of collection activities are implemented, involving the
sending of a collection letter, call-out reminders and collection messages via
text messaging.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wireless Broadband, Satellite, VSAT and Other Services</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our revenues from wireless
broadband, satellite, VSAT and other services consist mainly of wireless
broadband service revenues for Smart Broadband, rentals received for the lease
of Mabuhay Satellite's transponders and Telesat's VSAT facilities to other
companies, charges for ACeS Philippines&#146; satellite phone service and service
revenues generated from a PLDT Global subsidiary&#146;s mobile virtual network
operations.  Smart Broadband offers a number of wireless broadband services
with 57,826 subscribers as at June 30, 2006, including 54,165 <i>SmartBro </i> subscribers.
<i>SmartBro</i>, the fixed wireless broadband service of Smart linked to Smart
wireless broadband-enabled base stations, allows people to connect to the
Internet using an outdoor aerial antenna installed in a subscriber&#146;s home.  </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Gross revenues from
these services for the first half of 2006 amounted to Php1,515 million, an increase
of Php265 million, or 21%, from Php1,250 million in the same period in 2005 principally
due to the growth in our wireless broadband business.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our wireless non-service revenues consist of:</p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
proceeds from sales of cellular
handsets; and</p>

<p style='line-height:9.0pt;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
proceeds from sales of cellular
SIM-packs.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
wireless non-service revenues decreased by Php103 million, or 8%, to Php1,188
million in the first half of 2006 as compared to Php1,291 million in the same
period in 2005, primarily due to lower handset sales.  In the first half of 2006,
activations were driven more by SIM-pack sales.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Other Income</i></h6>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">All other income/gains
such as rental income and gains on short-term financial investments, which do
not fall under service and non-service revenues, are included under this
classification.  Our wireless business segment generated other income of Php133
million in the first half of 2006, an increase of Php76 million, or 133%, as
compared to Php57 million in the same period in 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Expenses</i></h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Expenses associated
with our wireless business in the first half of 2006 amounted to Php21,658
million, an increase of Php1,353 million, or 7%, from Php20,305 million in the
same period in 2005.  A significant portion of this increase was attributable
to higher rent, financing costs and compensation and benefits partially offset
by lower cost of sales and selling and promotions.  As a percentage of our
total wireless revenues and other income, expenses associated with our wireless
business remained flat at 54% in the first half of 2006 and 2005.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Cellular business
expenses accounted for 95% of our wireless business expenses, while wireless
broadband, satellite, VSAT and other business expenses accounted for the
remaining 5% of our wireless business expenses in the first half of 2006 as
compared to 96% and 4%, respectively, in the same period in 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes the breakdown of our
wireless-related expenses for the six months ended June 30, 2006 and 2005 and
the percentage of each expense item to the total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:103.12%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=13 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=13 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php5,195</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,970</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php225</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,427</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,255</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,172</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of sales</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,383</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,271</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(888)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Financing
 costs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,264</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,279</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">985</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,202</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,890</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">312</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.7pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.65pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Maintenance</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,795</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,617</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">178</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,329</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,702</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(373)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">864</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">701</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">163</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">552</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">667</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(115)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">446</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">491</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(45)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">422</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">492</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(70)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provisions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">284</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.7pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">437</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(153)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:4.3pt;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(35)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">137</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Other
 expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">358</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">394</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(36)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php21,658</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php20,305</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,353</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">__________</p>

<p style='margin-left:.5in;text-indent:-.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Includes salaries and
benefits, incentive plan, pension and manpower rightsizing program, or MRP,
costs.</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
and amortization charges increased by Php225 million, or 5%, to Php5,195 million
in the first half of 2006 principally due to an increase in the depreciable
asset base of the broadband business and additional depreciation provided for
certain equipment amounting to Php352 million and Php240 million for the first half
of 2006 and 2005, respectively.  The useful lives of these certain equipment have
been shortened due to network and equipment upgrade.  For further details, see <i>Note
8 &#150; Property, Plant and Equipment</i> to the accompanying unaudited
consolidated financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Rent expenses
increased by Php1,172 million, or 52%, to Php3,427 million on account of an
increase in domestic fiber optic network, or DFON, facilities leased by Smart from
PLDT and site rental expense.  As at June 30, 2006, we had 4,357 GSM cell sites
and 6,060 base stations, compared with 4,148 GSM cell sites and 5,573 base
stations as at June 30, 2005.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of sales decreased by Php888 million, or 27%, to Php2,383 million due to a
decrease in volume of phone kits sold and the termination of SIM-swapping
activities in May 2005.  The breakdown of cost of sales for our wireless
business for the six months ended June 30, 2006 and 2005 is as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Decrease</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cost of cellular handsets and SIM-packs
 sold</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,284</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,149</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php865)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Cost of satellite air time and terminal units</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">99</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">122</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(23)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,383</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,271</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php888)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK15"></a><a
name="OLE_LINK14">Financing costs in the first half of 2006 amounted to Php2,264
million, an increase of Php985 million, or 77%, from Php1,279 million in the
same period in 2005 due to the combined results of: (1) foreign exchange losses
recognized in the first half of 2006 compared to foreign exchange gains
recognized in the same period in 2005; and (2) higher amortization of discounts
brought about by the prepayment of Piltel&#146;s debt in June 2006, partially offset
by lower loss on derivatives recorded in the first half of 2006 as compared to
the same period in 2005.  The breakdown of our financing costs for our wireless
business for the six months ended June 30, 2006 and 2005 is as follows:</a></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:445.9pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,735</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,374</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php361</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Interest on loans and
 related items</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">899</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">905</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Foreign exchange losses
 (gains) &#150; net</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">205</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(778)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">983</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">126</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Dividends on preferred stock subject to mandatory
 redemption</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(39)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(30)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(35)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Loss on derivative
 transactions &#150; net</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">29</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">148</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(119)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(80)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Capitalized interest </p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(143)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(136)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">1,943</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(585)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(543)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,264</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php1,279</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php985</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Compensation and
benefits expenses increased by Php312 million, or 17%, to Php2,202 million
primarily due to higher accrued bonuses and employee benefits and higher
long-term incentive costs of Smart.  Smart&#146;s employee headcount increased by
30, or 1%, to 5,135 in the first half of 2006 compared to 5,105 in the same
period in 2005.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Maintenance expenses
increased by Php178 million, or 11%, to Php1,795 million, mainly on account of
higher expenses for electricity and power generation, higher repairs and
maintenance costs for network facilities and information technology equipment.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Selling and promotion expenses decreased by Php373
million, or 22%, to Php1,329 million due to efficient media spending and
termination of certain media contracts.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php163 million, or 23%, to <br>
Php864 million primarily due to increased call center, legal, contracted
service, market research and technical service fees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses decreased by Php115 million, or 17%, to Php552 million primarily due
to a decrease in Smart&#146;s business-related taxes.  </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses decreased by Php45 million, or 9%, to Php446
million due to lower mailing and courier, training, communication and local
travel expenses incurred in the first half of 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Insurance and security
services decreased by Php70 million, or 14%, to Php422 million primarily due to
the decrease in site security expenses and lower amortization charges on
prepaid insurance contracts.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Provisions decreased by Php153 million, or 35%, to
Php284 million primarily due to a decrease in write-down of slow-moving
handsets to net realizable values.  The breakdown of provisions for the six months
ended June 30, 2006 and 2005 is as follows:</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Decrease </b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Doubtful accounts</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php98</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php112</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php14)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Write-down of inventories to net realizable value </p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">186</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">325</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(139)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php284</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php437</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php153)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(35)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Amortization
of intangible assets decreased by Php2 million, or 1%, to Php137 million mainly
due to a reduction in the amount of intangible assets booked by Smart from the
purchase of Smart Broadband following the finalization by an independent
appraiser of the valuation work on the intangible assets in December 2005. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
expenses decreased by Php36 million, or 9%, to Php358 million due to lower various
business and operational-related expenses such as office supplies expense.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Provision for Income Tax</h3>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for income tax decreased by Php1,243 million, or 30%, to Php2,953 million in the
first half of 2006 from Php4,196 million in the same period in 2005.  In the
first half of 2006, the effective tax rate for our wireless business was 16%
compared to 24% in the same period in 2005 due to differences in the net
movement of deferred tax assets. </p>

<p style='line-height:10.0pt;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Net Income</h3>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our wireless business
segment recorded a net income of Php15,301 million in the first half of 2006,
an increase of Php1,971 million, or 15%, over Php13,330 million registered in the
same period in 2005 primarily due to the growth in our cellular service revenues
and lower provision for income tax, partly offset by an increase in operating
expenses.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Fixed Line</h6>

<p style='line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Revenues and Other Income</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0">Our fixed line business provides local exchange
service, international and national long distance services, data and other
network services, and miscellaneous services.  Total fixed line revenues
generated from our fixed line business in the first half of 2006 totaled Php24,318
million, a decrease of Php18 million from Php24,336 million in the same period
in 2005.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes revenues from our
fixed line business for the six months ended June 30, 2006 and 2005 by service
segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:102.96%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=15 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase</b><b> </b><b>(Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=15 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Local exchange</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php8,587</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,247</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php660)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">International long distance</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,051</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,253</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,202)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,504</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,519</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Data and other network</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,242</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,589</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,653</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Miscellaneous</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">669</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">627</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,053</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">99</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,235</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(182)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-Service Revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Other Income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">229</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">101</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">128</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">127</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total Fixed Line Revenues and Other Income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php24,318</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php24,336</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php18)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Service Revenues</h3>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Local Exchange Service</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our local exchange service revenues consist of: </p>

<p style='line-height:10.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
flat monthly fees for our postpaid
and fixed charges for our bundled services; </p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
installation charges and other
one-time fees associated with the establishment of customer service;</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues from usage of prepaid
cards for calls within the local area and any unused peso value of expired
prepaid cards; and</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
charges for special features,
including bundled value-added services such as call waiting, call forwarding,
multi-party conference calling, speed calling and caller ID. </p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes key measures of our
local exchange service business as at and for the six months ended June 30,
2006 and 2005:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.04%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=8 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June
 30, </b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=8 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.3pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total local exchange service revenues (in millions)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php8,587</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,247</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php660)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Number of fixed lines in service</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,070,721</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,137,813</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(67,092)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Number of fixed line employees</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,149</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,582</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(433)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed lines in service per employee</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">226</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">223</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Revenues from our
local exchange service decreased by Php660 million, or 7%, to Php8,587 million
in the first half of 2006 from Php9,247 million in the same period in 2005.
The decrease was primarily due to a 3% decline in the number of fixed lines in
service and the appreciation of the peso which required us to make downward
adjustments in our monthly local service rates.  The percentage contribution of
local exchange revenues to our fixed line service revenues decreased to 35% in the
first half of 2006 compared to 38% in the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Fixed
line net reduction in the first half of 2006 was 43,078 compared to a net reduction
of 14,214 in the same period in 2005.  In the first half of 2006, prepaid and
postpaid fixed lines in service declined by 37,493 and 5,585, respectively.  As
at June 30, 2006, postpaid and prepaid fixed line subscribers totaled 1,785,312
and 285,409, which accounted for approximately 86% and 14%, respectively, of our
total fixed lines in service.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Initially intended as
an affordable alternative telephone service for consumers under difficult
economic conditions, our prepaid fixed line services<i> </i>now form an
important part of our overall churn and credit risk exposure management and
subscriber retention strategy.  Prepaid<i> </i>subscribers are charged based on
usage at a rate of Php1.00 per minute for local calls, but the rates for
prepaid and postpaid fixed line subscribers for national and international long
distance calls are the same.  A prepaid fixed line subscriber is recognized as
an active subscriber when that subscriber activates and uses a prepaid call
card.  Prepaid fixed line subscribers can reload their accounts by purchasing
call cards that are sold in denominations of Php500, Php300 and Php150.  All
sales of prepaid cards, whether through dealers or through PLDT's business
offices, are non-refundable.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK5"></a><a
name="OLE_LINK3">&nbsp;</a></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
July 2006, PLDT launched the <i>Telepwede</i>, a new brand of our prepaid fixed
line service.  <a name="OLE_LINK47"></a><a name="OLE_LINK46"><i>Telepwede </i>subscribers
</a>are charged Php2 per local call (for an unlimited duration) and Php5 per
hour for Internet connection.  <i>Telepwede </i>subscribers can reload for as
low as Php145 per month which is inclusive of a Php30 load balance that can be
used for outgoing calls and a Php115 access charge for incoming calls. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Pursuant to a currency
exchange rate adjustment mechanism authorized by the Philippine National
Telecommunications Commission, or the NTC, <a name="OLE_LINK10"></a><a
name="OLE_LINK8">we adjust our postpaid monthly local service rates upward or
downward by 1% for every Php0.10 change in the peso-to-dollar exchange rate
relative to a base rate of Php11.00 to US$1.00</a>.  During the first half of
2006, we implemented four downward and two upward adjustments in our monthly
local service rates, while there were four downward adjustments for the same
period in 2005.  The average Philippine peso to U.S. dollar rate factored in
our monthly local service rates in the first half of 2006 was Php51.97 to
US$1.00, compared to an average of Php54.94 to US$1.00 in the same period in
2005.  This change in the average peso-to-dollar rate translated to a peso
appreciation of 5%, which resulted in an average net decrease of approximately 5%
in our monthly local service rates in the first half of 2006. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>International Long Distance Service</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our international long distance service revenues,
which we generate through our international gateway facilities, consist of:</p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
inbound call revenues representing
settlements from foreign telecommunications carriers for inbound international
calls, virtual transit and hubbing service and reverse charged calls such as
received collect and home country direct service;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
access charges paid to us by other
Philippine telecommunications carriers for terminating inbound international
calls to our local exchange network; and</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
outbound call revenues
representing amounts billed to our customers (other than our cellular
customers) for outbound international calls, net of amounts payable to foreign
telecommunications carriers for terminating calls in their territories.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows information about our
international fixed line long distance business for the six months ended June
30, 2006 and 2005:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.12%;border-collapse:collapse;width:98.12% !msorm;border-collapse:
 collapse !msorm'>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:.05in;text-align:
 center;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total international
 long distance service revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Php5,051</h4>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php6,253</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(Php1,202)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,265</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,289</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(1,024)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">786</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">964</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(178)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">International call volumes (in million
 minutes, except call ratio)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,031</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,156</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(125)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">939</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,085</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(146)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound-outbound
 call ratio</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">10.2:1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15.3:1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.05in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our total
international long distance service revenues decreased by Php1,202 million, or 19%,
to Php5,051 million in the first half of 2006 from Php6,253 million in the same
period in 2005 due to the peso appreciation, decrease in average termination
rates for inbound calls and decline in call volumes largely as a result of
alternative means of communications such as e-mailing, texting and Internet
telephony.  The percentage contribution of international long distance service
revenues to our fixed line service revenues decreased to 21% in the first half of
2006 from 26% in the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from inbound international long distance service decreased by Php1,024
million, or 19%, to Php4,265 million due to a decrease in inbound traffic
volume by 146 million minutes to 939 million minutes in the first half of 2006.  In addition, the appreciation of the peso to the
U.S. dollar with average rates of Php52.061 during the first half of 2006 and Php54.835
during the same period in 2005 contributed to the decrease in our inbound
international long distance revenues in peso terms since settlement charges for
inbound calls are billed in U.S. dollars or in special drawing rights, an
established method of settlement among international telecommunications
carriers using values based on a basket of foreign currencies that are
translated into pesos at the time of billing.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from outbound international long distance service decreased by Php178
million, or 18%, to Php786 million in the first half of 2006 primarily due to a
decline in average revenue per minute as a result of lower average collection
rate with the introduction of low-rate services such as <i>PLDT ID-DSL</i> and the
modified <i>Budget Card</i>, and the peso appreciation in the first half of 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 15, 2005, we introduced <i>PLDT ID-DSL</i>, a service that allows
overseas calls for registered <i>myDSL</i> plan subscribers using a regular
PLDT fixed line or a voice pad dialer for as low as US$0.10 per minute or
US$0.08 per minute, respectively, depending on the subscribers&#146; DSL plan/package.
</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">To
address the market&#146;s demand for low-priced international calls, PLDT modified
the <i>Budget Card</i>, a prepaid call card, offering a reduced IDD rate of Php5
per minute, as a promotional offer starting September 24, 2005, for calls to 89
overseas destinations including the United States, Canada, Japan and China<i>.</i>  Beginning March 4, 2006, <i>Budget Card</i> has been further modified to Php3,
Php5 and Php8 per minute calls depending on the destination and now has 100
overseas destinations, including Saudi Arabia and other Middle East countries.
<i>Budget Cards</i> are sold in denominations of Php200 and Php100, which must
be consumed within 30 days from first use.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">National Long Distance Service</h2>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our national long distance service revenues consist
of: </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
per minute charges for calls made by
our fixed line customers outside of the local service areas but within the
Philippines, net of interconnection charges payable for calls carried through
the backbone network of, and/or terminating to the customer of, another
telecommunications carrier; </p>

<p style='margin-left:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
access charges received from other
telecommunications carriers for calls carried through our backbone network
and/or terminating to our customers; and</p>

<p style='margin-left:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
fixed charges paid by other
telephone companies, charges retained by PLDT for calls terminating to cellular
subscribers within the local area, and local access charges paid by cellular
operators for calls by cellular subscribers that terminate to our local
exchange network.</p>

<p style='margin-left:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our national long distance
service revenues and call volumes for the six months ended June 30, 2006 and
2005:</p>

<p style='margin-left:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:102.08%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.8pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.8pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.8pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.8pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.8pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:7.8pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Decrease </b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.55pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total national long distance service
 revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,504</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,519</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right' style="margin-top:0;margin-bottom:0">(Php15)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance call volumes (in million
 minutes)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,122</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,235</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0">(113)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our national long
distance service revenues decreased by Php15 million to Php3,504 million in the
first half of 2006 from Php3,519 million in the same period in 2005 due to a decrease
in call volumes partially offset by a higher average revenue per minute in 2006
due to the change in mechanics in our Php10 per call promotion.  In 2005, the
Php10 per call promotion was open to all PLDT Group fixed line subscribers
nationwide; in 2006, the Php10 per call service was made available only to
registered PLDT subscribers for a monthly service fee.  Accordingly, the percentage
contribution of national long distance revenues to our fixed line service
revenues accounted for 14% in the first half of 2006 and 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
February 14, 2005, we launched a Php10 per call promotion to PLDT landline
subscribers nationwide and for calls to PLDT, Smart and <i>Talk &#145;N Text</i>
subscribers.  This promotion was launched with the objective of determining a
more effective tariff structure that would stimulate landline usage.  Under the
promotion, NDD calls between any PLDT
landline subscriber nationwide or to all Smart and <i>Talk 'N Text</i>
subscribers were charged Php10 per call instead of being charged on a per
minute basis.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
May 12, 2005, PLDT began offering the Php10 per call promotion with an
additional Php5 per call for the same unlimited talktime to Smart and <i>Talk
&#145;N Text</i> subscribers.  PLDT to PLDT NDD calls below the equivalent Php10 toll
usage were charged based on the regular rate per minute.  On August 12, 2005,
PLDT ceased offering the Php10 per call promotion to calls terminating to Smart
and <i>Talk &#145;N Text</i> subscribers.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Beginning
September 12, 2005, PLDT charged an optional Php20 add-on monthly service fee for
PLDT landline subscribers who may want to continue to avail themselves of the
Php10 per call promotion for calls within our network. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
January 2006, PLDT launched the <i>10-10-10</i> promotion.  This promotion
offers a flat rate of Php10 for unlimited calls terminating PLDT to PLDT and
Smart and <i>Talk &#145;N Text </i>subscribers for a Php50 monthly service fee. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
capped the Php10 per call service to Smart and <i>Talk &#145;N Text</i> subscribers
to those who registered on or before February 24, 2006.  PLDT fixed line
subscribers, however, can still register and avail of the unlimited Php10 per
call service for national long distance calls within the PLDT network.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Data and Other Network Services</h2>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our data and other network service revenues include
charges for leased lines, IP-based, packet-based and switched-based services.
These services are used for domestic and international communications such as
private networking, broadband and narrowband Internet-based data
communications, and packet-based communication.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table shows salient information about our data and other network
service revenues for the six months ended June 30, 2006 and 2005:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:9.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">Data and other network service
 revenues</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php6,242</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,589</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php1,653</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">Number of PLDT DSL broadband
 subscribers</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">109,245</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">63,902</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">45,343</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">Number of PLDT Vibe
 narrowband subscribers</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">425,761</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">364,123</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">61,638</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
data and other network services in the first half of 2006 posted revenues of
Php6,242 million, an increase of Php1,653 million, or 36%, from Php4,589
million in the same period in 2005 primarily due to increases in leased lines,
IP-based and switched-based data services, particularly Diginet, <i>PLDT DSL</i>
and <i>PLDT Vibe</i> services, respectively.  The revenue contribution of this
service segment to our fixed line service revenues increased to 26% in the
first half of 2006 from 19% in the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Internet-based products are bannered by <i>PLDT</i> <i>DSL</i> (<i>myDSL and BizDSL</i>), <i>PLDT Vibe</i> and I-Gate.  <i>PLDT</i> <i>DSL </i>broadband Internet service is targeted for
heavy individual Internet users as well as for small and medium enterprises,
while<i> PLDT Vibe,</i> or PLDT&#146;s dial-up/narrowband Internet
service, is targeted for light to medium residential or individual Internet
users.  I-Gate, our dedicated leased line Internet access service, on the other
hand, is targeted to enterprises and value-added service providers.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>PLDT
DSL</i>, which contributed revenues of
Php1,500 million during the first half of 2006 increased by Php449 million, or 43%,
from Php1,051 million in the same period in 2005.  <i>PLDT DSL</i> has reached 109,245
subscribers as at June 30, 2006 compared with 63,902 subscribers in the same
period in 2005.  PLDT offers a number of <i>DSL </i>packages with speeds and
monthly fees varying from 256 kbps at Php999 per month to up to 1 Mbps at
Php3,000 per month.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>PLDT
Vibe</i> revenues increased by Php56
million, or 41%, to Php192 million in the first half of 2006 from Php136
million in the same period in 2005.  As
at June 30, 2006, the number of PLDT&#146;s fixed line subscribers for <i>PLDT Vibe </i>stood
at 425,761, of which 152,149 were exclusive postpaid users, 246,963 were exclusive
prepaid users, and 26,649 were both postpaid and prepaid users.  As at June 30,
2005, <i>PLDT Vibe</i> subscribers totaled 364,123, of which 143,088 were exclusive
postpaid users, 196,232 were exclusive prepaid users, and 24,803 were both
postpaid and prepaid users.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">The continued growth
in data services revenues can be attributed to several product offerings.  The
steady demand for dedicated connectivity or private networking from the
corporate market using PLDT&#146;s traditional bandwidth offerings &#150; Fibernet,
Arcstar, Acacia, I-Gate, Diginet, BRAINS, among others &#150; continues to provide
us with a stable revenue source.  Through Diginet, we provide Smart&#146;s
increasing fiber optic and leased line data requirements, which are included
under our national data services.  Diginet contributed Php2,826 million in our
data revenues in the first half of 2006, increasing by Php1,074 million, or 61%,
from Php1,752 million in the same period in 2005.</p>

<p style='text-indent:40.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:40.5pt' style="margin-top:0;margin-bottom:0">We
introduced <i>PLDT WeRoam</i>, a wireless broadband service offering running on
Smart's nationwide wireless network (using GPRS, EDGE and WiFi technologies)
and PLDT's extensive IP infrastructure.&nbsp;&nbsp; Some of the recent
enhancements to the service are the inclusion of international roaming in key
roaming countries all over the globe and national WiFi roaming access.
Principally targeted to the corporate market, the service had 6,622 subscribers
as at June 30, 2006.  </p>

<p style='text-indent:40.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:40.5pt' style="margin-top:0;margin-bottom:0">In
June 2006, we introduced <i>Shops.Work UnPlugged</i>, or SWUP, to address the
need of retailers and banks for real-time wireless data communication.  SWUP is
the first bundled solution that makes wireless cashier point-of-sale and
wireless card terminals possible.  Retailers will now be able to reach out to a
bigger market in areas where physical connections are unavailable and expand
the banking system with wireless automated teller machines, or ATMs.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Miscellaneous</h2>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Miscellaneous service
revenues are derived mostly from directory advertising and facilities rental.
In the first half of 2006, these revenues increased by Php42 million, or 7%, to
Php669 million from Php627 million in the same period in 2005.  The improvement
was mainly due to an increase in co-location charges from more co-location
sites coupled with an increase in rent income on duct utilization and cable
restoration.  The percentage contribution of miscellaneous service revenues to
our fixed line service revenues was 3% in the first half of 2006 and 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Non-service
revenues of Php36 million recognized under our fixed line business represent
proceeds of computer sales in the first half of 2006 in relation to our DSL
promo.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Other Income</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">All other income/gains
such as rental income, gain on disposal of property, which do not fall under
service and non-service revenues are included under this classification.  In the
first half of 2006, our fixed line business segment registered an increase in
other income of Php128 million, or 127%, to Php229 million in the first half of
2006 from Php101 million in the same period in 2005 primarily due to higher
rental income, income from disposal of materials, and higher service and facility
fees.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Expenses</h3>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expenses related to our fixed line business in the
first half of 2006 totaled Php24,022 million, an increase of Php4,126 million,
or 21%, compared to Php19,896 million in the same period in 2005.  The increase
was primarily due to higher depreciation and amortization, compensation and
benefits, and financing costs partially offset by lower provisions and maintenance
expenses.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our total
fixed line-related expenses for the six months ended June 30, 2006 and 2005 and
the percentage of each expense item to the total:</p>

<p style='text-indent:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:102.34%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=14 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=14 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.7pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php10,038</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php5,704</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">29</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4,334</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">76</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,560</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,977</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">583</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing costs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,876</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,537</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">339</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Maintenance</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,611</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,718</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(107)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">975</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">866</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">827</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">860</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(33)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provisions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">485</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,550</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(1,065)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">469</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">432</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">343</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">330</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">265</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">329</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(64)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">239</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">215</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of sales</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:2.9pt;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">257</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">378</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(121)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(32)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php24,022</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php19,896</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4,126</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)   Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style='margin-left:.25in;text-indent:-.25in;line-height:
3.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
and amortization charges increased by Php4,334 million, or 76%, to Php10,038
million mainly due to the effect of our change in estimated useful lives of
certain property and equipment in line with
our upgrade to the next-generation
network which resulted in increased
depreciation charges of Php3,882 million for the first half of 2006, and higher
depreciation of our regular asset base from
additional completed projects.  Please see <i>Note 8 &#150; Property, Plant and
Equipment</i> to the accompanying unaudited consolidated financial statements
for further discussion.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Compensation and
benefits expenses increased by Php583 million, or 15%, to Php4,560 million
primarily due to the effect of the collective bargaining agreement-related increases
in salaries and benefits and an increase in incentive plan-related accruals
partially offset by a reduction in headcount due to PLDT&#146;s MRP.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Financing costs increased
by Php339 million, or 10%, to Php3,876 million due to lower derivatives and foreign
exchange gains recorded in the first half of 2006 compared to the same period
in 2005 and higher hedge costs partially offset by lower interest on loans and
related items owing to lower debt balances in the first half of 2006 compared
to the same period in 2005.  The breakdown of financing costs for our fixed
line business for the six months ended June 30, 2006 and 2005 is as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,449</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,737</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,288)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Hedge costs</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">746</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">557</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">34</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">88</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">135</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(47)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(35)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Gain on derivative transactions &#150; net</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(926)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">920</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(99)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange gains &#150; net</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(603)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">596</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(99)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capitalized interest</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(159)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(196)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(243)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(193)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(50)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,876</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,537</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php339</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Maintenance expenses
decreased by Php107 million, or 6%, to Php1,611 million primarily due to lower
maintenance costs for foreign cable and wire facilities as more operating and
maintenance-related restorations were incurred in the first half of 2005 as
compared to the same period in 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Selling and promotion
expenses increased by Php109 million, or 13%, to Php975 million primarily as a
result of an increase in PLDT&#146;s promotional activities in relation to various
products and services, such as PLDT&#146;s <i>Pwede!</i> campaign, partially offset
by lower commissions paid in the first half of 2006.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent
expenses decreased by Php33 million, or 4%, to Php827 million due to lower office
and building rentals, and decrease in transponder lease charges partially
offset by an increase in international leased circuits and rental charges
occupied by various equipments.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provisions
decreased by Php1,065 million, or 69%, to Php485 million primarily on account
of a lower provision by PLDT for anticipated uncollectible accounts from
various specifically identified domestic telecommunications carriers which were
provided for in 2005.  The breakdown of provisions for our fixed line business for the six
months ended June 30, 2006 and 2005 is as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='height:4.95pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='height:4.95pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Doubtful accounts</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php336</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,414</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,078)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(76)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Onerous contracts and assessments</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">136</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php485</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,550</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,065)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Professional and other
contracted services increased by Php37 million, or 9%, to Php469 million
primarily due to an increase in facility management fees and collection agency
fees, partially offset by lower advisory and legal fees in the first half of
2006 for various services. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php13 million, or 4%, to Php343 million mainly on
account of higher NTC supervision and license fees, and other business-related
taxes paid in the first half of 2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance
and security services decreased by Php64 million, or 19%, to Php265 million
primarily due to lower premiums on property all-risk, industrial all-risk and
industrial fire insurance, partially offset by higher security services due to
a rate increase for contracted security guards.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses increased by Php24 million, or 11%, to Php239 million
due to an increase in local and foreign travel and training in the first half of
2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of sales of computers amounting to Php77 million were recognized in the first half
of 2006 in relation to our DSL promo.  No similar charges were incurred in the
same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
expenses decreased by Php121 million, or 32%, to Php257 million due to lower
office supplies consumption and printing costs resulting from PLDT&#146;s continuing
cost-containing activities.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Provision for Income Tax</h3>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK4">Provision
for income tax amounted to Php45 million in the first half of 2006 as compared
to Php1,281 million in the same period in 2005, a decrease of Php1,236 million,
or 96% primarily due </a>to lower income subject to tax.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Net Income </h3>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">In the first half of
2006, our fixed line business segment contributed a net income of Php251
million, a decrease of Php2,908 million, or 92%, as compared to Php3,159
million in the same period in 2005 mainly as a result of a 21% increase in fixed
line-related expenses, particularly depreciation and amortization.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="OLE_LINK32">Information and
Communications Technology</a></h3>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><b><i>Revenues and Other Income</i></b></h5>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our information and
communications technology business is conducted by ePLDT and its subsidiaries.
</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In the
first half of 2006, our information and communications technology business
generated revenues of Php2,011 million, an increase of Php424 million, or 27%,
from Php1,587 million in the same period in 2005.  Going forward, we expect
revenues from our call center business to continue to contribute significantly
to our information and communications technology revenues with the growing
demand for our call center services.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table summarizes revenues from our
information and communications technology business for the six months ended June
30, 2006 and 2005 by service segment:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:464.7pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=11 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=11 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  colspan=11 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Call center</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,237</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php836</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php401</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Internet and gaming </p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">340</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">287</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Vitro</i>&#228; data center</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">173</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">60</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">88</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,812</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">90</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,328</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">84</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">484</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Point Product Sales</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">172</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">215</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(20)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
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 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
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 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
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 <p align=right style='margin-right:2.9pt;text-align:right;
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other Income</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(41)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
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 </td>
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 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Equity share in net income of associates</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
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 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total ICT Revenues and Other Income</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,011</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,587</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php424</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Service
revenues generated by our information and communications technology segment
amounted to Php1,812 million in the first half of 2006, an increase of Php484
million, or 36%, as compared to Php1,328 million in the same period in 2005
primarily as a result of the continued growth of our call center business. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Call</i><i> Center</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are focused on developing our call center business which capitalizes on the
availability of English-speaking college graduates in the Philippines with a strong customer service orientation.  ePLDT now uses one umbrella brand name, <i>ePLDT
Ventus</i>, for all of its call center businesses, including Vocativ and
Parlance.  Vocativ provides customer and technical support to its clients in
the Philippines, U.S. and U.K., while Parlance provides the exclusive customer
support and billing requirements to one of the largest direct-to-home satellite
television providers in the U.S.  In aggregate, we own and operate approximately
4,660 seats with 3,500 customer service representatives, or CSRs, as at June 30,
2006 compared to approximately 3,180 seats with 2,550 CSRs as at June 30, 2005.
 In 2006, ePLDT launched two new sites
bringing its total call center sites to seven as at June 30, 2006.  </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Call center revenues consist of:</p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
inbound calls for customer care,
product inquiries, sales and technical support based on active minutes,
billable hours and full-time equivalents;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
outbound calls for sales and
collections based on active minutes, billable hours and full-time equivalents;
and </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
service income for e-mail
handling, web chat, web co-browsing, data entry and business process
outsourcing, or BPO, based on transaction volume.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Revenues related to our call center business in the
first half of 2006 increased by Php401 million, or 48%, to Php1,237 million
from Php836 million in the same period in 2005 primarily due to the combined
effects of the following:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Vocativ&#146;s upward price adjustment
for calls and an increase in programs being handled; </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an upward price adjustment by
Parlance for its inbound and outbound projects, coupled with an increase in the
number of registered minutes for inbound projects and hours for outbound
projects; </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
expansion of existing Parlance and
Vocativ facilities by 560 and 100 seats, respectively, from approximately 1,230
and 1,300 in the first half of 2005 to approximately 1,790 and 1,400 in the
same period in 2006;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
commencement of Ventus operations
in Iloilo in March 2005; and</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
continuous ramp up of CSRs by 950,
or 37%, from a total of approximately 2,550 in the first half of 2005 to approximately
3,500 in the same period in 2006.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Call center revenues accounted for 68% and 63% of
total information and communications technology service revenues in the first half
of 2006 and 2005, respectively.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Internet and gaming </i></p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">ePLDT has also invested in a number of other
e-commerce and Internet-related businesses, which include:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 99.6% interest in Infocom, an Internet
service provider offering consumer prepaid and postpaid Internet access,
corporate leased lines, dedicated dial-up, multi-user dial-up, broadband Internet
access through DSL, web consulting and development, hosting and other
value-added services; </p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 75% interest in Digital Paradise,
an Internet caf&#233; business with the brand <i>Netopia</i>; </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 60% interest in netGames, a
publisher for Massively Multi-player Online Game in the Philippines and the
Philippine licensee of Khan Online, Pangya and Flyff, and the owner of
Juanworld, a community gaming portal;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 60% interest in Level Up!, a leading publisher of online games
in the Philippines with about 80% of the online gaming market.  Level Up! was
acquired on May 1, 2006;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 51% interest in Airborne Access,
the country&#146;s leading operator of WiFi hotspots, which provides wireless Internet
access in hotspots equipped with WiFi access points; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a 51% interest in Digital Paradise
 Thailand, an affiliate of Digital Paradise, offering similar products and
services with four branches in Bangkok, Thailand. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Internet service revenues consist of: </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from actual usage
of the Internet access network by prepaid subscribers and any unused peso value
of expired prepaid cards or electronic Internet time loads, net of discounts
given to dealers; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees from postpaid
corporate and consumer subscribers including: (1) charges for Internet usage in
excess of allocated free plan Internet hours; (2) one-time installation and
activation fees; and (3) fees for value added services including e-mail and web
hosting services;</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
one-time fees generated from
resellership of Internet-related solutions such as security solutions and
domain registration; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
franchise and royalty fees for <i>Netopia</i>
Internet caf&#233;s, including a one-time subscription fee and monthly recurring
franchise fees based on certain conditions on the franchise agreement; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues from community access of
computers and desktop publishing based on actual usage, net of discounts given
to users; and </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
online gaming revenues from unique
subscribers, including one-time sale of gaming cards and electronic pins, and
top-up fees upon actual consumption of gaming credits or after expiration of
any unused peso value thereof.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Revenues from our Internet
business in the first half of 2006 increased by Php53 million, or 18%, to Php340
million from Php287 million in the same period in 2005 primarily due to the
consolidation of Airborne Access and Level Up! in October 2005 and May 2006,
respectively, which resulted to additional revenues of Php6 million and Php39
million, respectively.  Our Internet business revenues accounted for 19% and 22%
of service revenues from information and communications technology business in the
first half of 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Vitro</i>&#228; data center</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ePLDT
operates an Internet data center under the brand name <i>Vitro</i>&#228; which provides co-location services, server hosting, hardware and software
maintenance services, website development and maintenance services, webcasting
and webhosting, shared applications, data disaster recovery and business
continuity services, intrusion detection, and security services such as
firewall and managed firewall.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Vitro</i>&#228; revenues consist of:</p>

<p style='text-indent:0in;line-height:6.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees derived from
co-location services, server hosting, hardware and software maintenance
services, website development and maintenance services, web hosting, data
recovery security services and other value added services; and </p>

<p style='text-indent:0in;line-height:6.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
installation charges or one-time
fees associated with the set-up of services and professional services of
Vitro&#146;s certified professionals.</p>

<p style='margin-left:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In the first half of 2006, <i>Vitro</i>&#228; contributed revenues of Php175 million, an increase of Php2 million,
or 1%, from Php173 million in the same period in 2005 primarily due to an
increase in co-location revenues and server hosting.  <i>Vitro</i>&#228; revenues accounted for 10% and 13% of service revenues from our information
and communications technology business in the first half of 2006 and 2005,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Others</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other revenues consist of:</p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
fees generated for issuance of
digital certificates and licenses; and </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from IT
helpdesk/contact center solutions and terminals for credit, debit and credit
card transactions.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues from other businesses related to our
information and communications technology segment in the first half of 2006
increased to Php60 million from Php32 million in the same period in 2005
largely due to IT helpdesk/contact center services rendered coupled with an
increase in the number of digital certificates sold.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Please
refer to <i>Note 9 &#150; Investments</i> <i>in Associates</i> to the accompanying unaudited
consolidated financial statements for further discussion on ePLDT&#146;s other information
and communications technology services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Non-service
revenues consist of sales generated from reselling certain software licenses,
server solutions, networking products, storage products and data security
products.  In the first half of 2006, non-service revenues generated by our
information and communications technology business decreased by Php43 million,
or 20%, to Php172 million compared to Php215 million in the same period in 2005
primarily due to lower revenues from sales of networking equipment and software
licenses.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Other Income</i></h6>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">All other income/gains
which do not fall under service and non-service revenues are included under
this classification.  Other income generated from our information and
communications technology business segment decreased to Php24 million in the
first half of 2006 from Php41 million in the same period in 2005 primarily due to
Infocom&#146;s sale of its <i>NOW</i> cable Internet business in the first half of 2005;
no similar transaction was incurred in the same period in 2006.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Equity Share in Net Income
of Associates</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Equity
share in net income of associates amounted to Php3 million in the first half of
2006 and 2005 due to share in the earnings of its unconsolidated subsidiaries,
ePDS, Inc. and Philweb Corporation, or Philweb.  ePLDT acquired a 20% interest in
Philweb in June 2006.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></h6>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Expenses</i></h6>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Expenses associated
with our information and communications technology business totaled Php1,936
million in the first half of 2006, an increase of Php418 million, or 28%, from
Php1,518 million in the same period in 2005, primarily due to an increase in compensation
and benefits, depreciation and amortization, and selling and promotions.  As a
percentage of our information and communications technology revenues, expenses
related to our information and communications technology business were at 96% for
the first half of 2006 and 2005.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our total
information and communications technology-related expenses for the six months
ended June 30, 2006 and 2005 and the percentage of each expense item to the
total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:102.32%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=13 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=13 valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Information and communications technology services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php855</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php625</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php230</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">187</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">65</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">234</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">205</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">29</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">228</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">208</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Maintenance</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(10)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">39</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provisions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing costs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(163)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">39</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">108</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,936</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,518</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php418</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style='text-indent:.5in;line-height:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)   Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation
and benefits increased by Php230 million, or 37%, to Php855 million largely due
to the expansion of our call center businesses and the consolidation of Level
Up! and Airborne Access in the first half of 2006, which resulted to an increase
in headcount thereby causing an increase in salaries, bonuses and various
incentives of employees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Depreciation and
amortization charges increased by Php65 million, or 35%, to Php252 million
primarily due to an increase in the depreciable asset base in relation to the
expansion of our call center businesses.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotion expenses increased by Php29
million, or 14%, to Php234 million mainly due to an increase in advertising and
marketing spending and the consolidation of Level Up! and Airborne Access in
the first half of 2006 as compared to the same period in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent
expenses increased by Php20 million, or 10%, to Php228 million primarily due to
the opening of two additional call center sites during the first half of 2006
which led to increased rental of leased circuits.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Maintenance expenses decreased
by Php10 million, or 7%, to Php139 million primarily due to Vitro&#146;s lower hardware
maintenance costs partially offset by higher hosting-related costs incurred in the
first half of 2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses increased by Php37 million, or 97%, to Php75
million due to the increased cost of phone lines, bandwidth and information
system charges, coupled by the increase in telecommunications costs incurred by
our call center business for its outbound calls.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php11 million, or 28%, to <br>
Php50 million primarily due to an increase in consultancy, legal and audit fees
in the first half of 2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php1 million, or 6%, to Php19 million due to higher business-related
taxes paid in the first half of 2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Insurance and security
services increased by Php5 million, or 100%, to Php10 million primarily due to
higher premium costs and an increase in the assets insured in the first half of
2006 as compared to the same period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Amortization
of intangible assets amounted to Php3 million in the first half of 2006 in
connection with the acquisition of Level Up!.  See <i>Note 11 &#150; Goodwill and
Intangible Assets</i> to the accompanying
unaudited consolidated financial statements
for further discussion.  No similar charges were booked in the same period in
2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provisions
amounted to Php1 million in the first half of 2006 representing certain
doubtful customer accounts.  No similar provisions were recorded in the same
period in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Financing costs
amounted to a negative Php5 million in the first half of 2006 primarily due to a
net interest income balance in 2006 brought about by a decrease in interest expense
on loans on account of lower debt balances in the first half of 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Other expenses increased
by Php39 million, or 108%, to Php75 million mainly due to higher royalty fees
on licenses paid by our Internet and gaming businesses, and increase in other
business-related costs.</p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Provision for (Benefit from) Income Tax </i></h6>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:left;text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Benefit from income tax amounted to Php12 million in the
first half of 2006 primarily due to the recognition of deferred tax assets
pertaining to accrued pension costs, net operating loss carry-over and
allowance for doubtful accounts as compared to a provision for income tax of
Php6 million in the same period in 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Net Income</i></h6>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">In the first half of
2006, our information and communications technology business segment registered
a net income of Php87 million, an increase of Php24 million, or 38%, as compared
to Php63 million in the same period in 2005 mainly as a result of a 27%
increase in ICT-related revenues. </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Liquidity and Capital Resources</b></p>

<p style='line-height:10.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our consolidated cash flows
for the six months ended June 30, 2006 and 2005 as well as consolidated
capitalization and other selected financial data as at June 30, 2006 and December
31, 2005:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.88%;;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK2"><b>Six Months Ended June
 30,</b></a></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;text-indent:12.75pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Cash Flows </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash provided by operating activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,601</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,151</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash used in investing activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,898</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,220</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,385</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,012</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash used in financing activities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,943</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,528</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:31.5pt;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net increase (decrease) in cash and cash
 equivalents</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,098)</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:5.05pt;
 margin-bottom:0in;margin-left:.85pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,308</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.85pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.85pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:1.3pt;
 margin-bottom:0in;margin-left:5.2pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:1.3pt;
 margin-bottom:0in;margin-left:5.2pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:1.3pt;
 margin-bottom:0in;margin-left:5.2pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:1.3pt;
 margin-bottom:0in;margin-left:5.2pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.85pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.85pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:1.3pt;
 margin-bottom:0in;margin-left:5.2pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Capitalization </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Long-term portion of interest-bearing
 financial liabilities &#150; <br>
 net of current portion:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Long-term debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php72,410</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php84,860</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Obligations under capital lease</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">269</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">381</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Preferred stock subject to mandatory
 redemption</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,854</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">82,533</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97,215</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current portion of interest-bearing financial
 liabilities: </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Long-term debt maturing within one year</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,281</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,684</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Obligations under capital lease maturing
 within one year</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">828</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">717</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,109</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,401</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total interest-bearing financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">101,642</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">116,616</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total equity</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">85,870</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,369</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php187,512</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php190,985</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Other Financial Data </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php244,771</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php249,713</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Property, plant and equipment - net</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">173,832</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">176,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25,966</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,064</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006,
our consolidated cash and cash equivalents totaled Php25,966 million.
Principal sources of consolidated cash and cash equivalents in the first half of
2006 were cash flows from operating activities amounting to Php33,601 million
and drawings from Smart&#146;s debt facilities aggregating Php3,435 million.  These
funds were used principally for capital outlays of Php12,385 million, total
debt principal payments of Php17,954 million and interest payments of Php3,977
million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Operating Activities </i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our consolidated net
cash flows from operating activities in the first half of 2006 decreased by Php1,550
million, or 4%, to Php33,601 million, from Php35,151 million in the same period
in 2005.</p>

<p style='text-indent:.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">A significant portion of our cash flow is generated
by our wireless business, which contributed revenues of approximately 60% and 59%
of our service revenues in the first half of 2006 and 2005, respectively.
Revenues from our fixed line and information and communications technology
services accounted for 37% and 3%, respectively, of our service revenues in the
first half of 2006 compared to 39% and 2%, respectively, in the same period in
2005. </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Cash flows from operating activities of our wireless
business amounted to Php17,226 million in the first half of 2006, a decrease of
Php3,533 million, or 17%, compared to Php20,759 million in the same period in
2005 partially offset by an increase in our fixed line business which contributed
Php14,699 million in the first half of 2006, an increase of Php540 million, or 4%,
compared to Php14,159 million in the same period in 2005.  The overall decrease
in our cash flows from operating activities was due to an increase in working
capital requirements with the settlement of various current liabilities complemented
by higher billings of accounts receivable.  Our wireless business segment
accounted for 52% of our cash flows from operating activities while our fixed
line segment accounted for 44% in the first half of 2006.  We currently believe
that our continuing strong cash flows from operating activities on a
consolidated basis will allow us to defray our current liabilities despite our
current ratio being less than 1:1 as at June 30, 2006. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto;text-autospace:none' style="margin-top:0;margin-bottom:0">While
Smart is subject to loan covenants that restrict its ability to pay dividends,
redeem preferred shares, make distributions to PLDT or otherwise provide funds
to PLDT or any associate without the consent of its lenders, Smart had been
able to obtain waivers from Finnvera and certain of its lenders for each of the
dividend payments made by Smart to PLDT in 2006, 2005, 2004, 2003 and 2002
aggregating Php14,000 million, Php19,717 million, Php16,100 million, Php6,166
million and Php1,540 million, respectively.  In September and December 2005,
Smart redeemed 200 million and 180.8 million preferred shares, respectively,
previously issued to PLDT at a redemption price of Php13.875 per share, or a
total redemption price aggregating to Php5,283 million.  During the first half
of 2006, dividend payments received from Smart amounted to Php14,000 million,
of which Php7,000 million was paid in March 2006 and another Php7,000 million
was paid in June 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Investing Activities </h3>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Net cash used in
investing activities in the first half of 2006 amounted to Php13,898 million, an
increase of Php11,678 million, or 526%, compared to Php2,220 million in the
same period in 2005.  This was primarily a result of an increase in capital
expenditures by Php5,373 million, payments for purchase of investments in
relation to the final settlement of Smart Broadband&#146;s acquisition, the purchase
of a 60% investment in Level Up! and a 20% equity interest in Philweb of Php1,201
million, Php346 million and Php427 million, respectively, and the increase in short-term
investments by Php4,271 million in the first half of 2006 as compared to the
decrease in the first half of 2005 mainly due to maturity of Smart&#146;s prepaid
forward exchange contracts in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our consolidated
capital expenditures in the first half of 2006 totaled Php12,385 million, an increase
of Php5,373 million, or 77%, from Php7,012 million in the same period in 2005
primarily due to PLDT&#146;s, Smart&#146;s and ePLDT&#146;s higher capital spending.  Smart's
capital spending of Php6,025 million in the first half of 2006 was used to roll-out
its 3G network and further expand and upgrade its transmission network
facilities to increase capacity and coverage in respect of basic and advanced
cellular services.  PLDT's capital spending of Php5,765 million was principally
used to finance the expansion of its fixed line data and IP-based network
services.  ePLDT and its subsidiaries&#146; capital spending of Php520 million was primarily
used to fund its call center expansion.  The balance represented other
subsidiaries&#146; capital spending.  Consolidated capital expenditures in the same
period in 2005 amounted to Php7,012 million, of which Php3,569 million, Php3,118
million and Php305 million were attributable to Smart, PLDT and ePLDT,
respectively.  The balance represented other subsidiaries&#146; capital spending.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Financing Activities</i></b></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">On a consolidated basis, we used net cash of Php23,943
million for financing activities, net of loan drawings by Smart, in the first half
of 2006, a decrease of Php585 million, or 2%, compared to Php24,528 million in the
same period in 2005.  The net cash used in financing activities in the first half
of 2006 was mainly attributable to debt repayments and interest payments by
PLDT and Piltel in line with our ongoing debt reduction program and dividend
payments distributed by PLDT to its common and preferred stockholders.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Debt Financing </h2>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Additions to our consolidated long-term debt in the
first half of 2006 totaled Php3,446 million mainly from Smart's drawings
related to the financing of its Phase 8 loan facilities.  Payments in respect
of principal and interest of our total debt amounted to Php17,954 million and
Php3,977 million, respectively, in the first half of 2006, of which Php11,395
million and Php3,250 million were attributable to PLDT, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows our long-term debt,
including current portion, as at June 30, 2006 and December 31, 2005:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>December 31,</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='height:7.6pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;height:7.6pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Audited)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar Debt:</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Export Credit Agencies-Supported Loans</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php19,088</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php23,126</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php4,038)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed Rate Notes</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">44,838</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52,354</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7,516)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Term Loans</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,971</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,288</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,683</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Restructured Loans</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,720</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,767</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,047)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Satellite Acquisition Loans</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,655</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,040</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(385)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr style='height:6.25pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.25pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:6.25pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">86,272</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.25pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:6.25pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">97,575</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.25pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:6.25pt'>
 <p align=right style='margin-left:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11,303)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.25pt'>
 <p align=center style='margin-top:0in;margin-right:5.75pt;
 margin-bottom:0in;margin-left:2.9pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:6.25pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(12)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Japanese Yen Debt:</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">JBIC&#146;s Overseas Investment Loan</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,593</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(546)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Export Credit Agency-Supported Loan</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(709)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(100)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,593</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,848</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,255)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(33)</p>
 </td>
 </tr>
 <tr style='height:8.95pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippine Peso Debt:</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Peso Fixed Rate Corporate Notes</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,577</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,576</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt' style="margin-top:0;margin-bottom:0">Term
 Loans</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">34</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">166</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(132)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(80)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt' style="margin-top:0;margin-bottom:0">Restructured
 Loans</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">215</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">379</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(164)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,826</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,121</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(295)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php90,691</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php103,544</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(Php12,853)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(12)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For
a complete discussion of long-term debt, see <i>Note 17 &#150; Interest-bearing
Financial Liabilities </i>to the accompanying unaudited consolidated financial
statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our long-term debt
decreased by Php12,853 million, or 12%, to Php90,691 million as at June 30, 2006
largely due to debt amortizations and prepayments in line with PLDT&#146;s efforts
to reduce its overall debt level and also due to the appreciation of the peso.
PLDT&#146;s debt was reduced by 15% to Php62,305 million by June 30, 2006.  In
addition, the debt levels of Smart decreased by 4%, to Php25,697 million
(including Piltel&#146;s debt of Php2,984 million), while Mabuhay and ePLDT decreased
by 13% and 79%, to Php2,655 million and Php34 million, respectively, as at June
30, 2006 due to amortizations and prepayments during 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto;text-autospace:none' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, PLDT had no undrawn committed long-term credit facilities.  On
August 8, 2005, Smart signed a US$30 million commercial facility with Nordic
Investment Bank to partly finance the related Phase 8 GSM equipment and
services contracts.  The facility was drawn in July 2006.  On August 10, 2005,
Smart signed a US$70 million loan facility with Finnish Export Credit Ltd. for
its GSM Phase 8 financing.  Smart opted to utilize only a total of US$66.79
million which was drawn on February 15, 2006 and March 13, 2006 for US$10.02
million and US$56.77 million, respectively.  The balance of US$3.2 million was
cancelled.  After the first repayment on March 1, 2006, US$66 million remained
outstanding as at June 30, 2006.  Smart also had available facilities under its
&#128;50 million Framework Agreement with Bayerische Hypo-und Vereinsbank
Aktiengesellschaft up to a maximum aggregate amount of &#128;44 million.  Please see
<i>Note 17 &#150; Interest-bearing Financial Liabilities </i>to the accompanying unaudited
consolidated financial statements for a detailed discussion of our long-term
debt.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The scheduled maturities of our outstanding unaudited
consolidated long-term debt at nominal values as at June 30, 2006 are as
follows:  </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>US$ Loans</b>(1)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>JP&yen; Loans</b>(2)</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Peso Loans</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.75pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:10.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=11 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"> <b>(in millions)</b> </p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2006(3)</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$79</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,211</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">JP&yen;1,394</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php648</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php793</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php5,652</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">345</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,379</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,788</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,297</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,712</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">124</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,602</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,394</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">648</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,274</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">281</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,948</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,972</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010 </p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,337</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">834</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,171</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011 and onwards</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">872</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">46,416</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">46,586</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$1,764</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php93,893</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">JP&yen;5,576</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,593</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,881</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php98,367</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">________________</p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>The exchange rate used was
Php53.220 to US$1.00.</i></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>The exchange rate used was
Php0.4650 to JP</i><i>&yen;1.00. </i></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><i>(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>July 1, 2006 to December 31,
2006.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Approximately Php51,781
million principal amount of our consolidated outstanding long-term debt as at June
30, 2006 is scheduled to mature over the period from 2006 to 2010.  Of this
amount, Php33,669 million was attributable to PLDT, Php15,424 million to Smart (including
Piltel&#146;s debt of Php1,378 million) and the remainder to Mabuhay Satellite,
Maratel and ePLDT.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Debt
Covenants</i></p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
debt instruments contain restrictive covenants, including covenants that could
prohibit us from paying dividends on common stock under certain circumstances,
and require us to comply with specified financial ratios and other financial
tests, calculated in conformity with accounting principles generally accepted
in the Philippines, at relevant measurement dates, principally at the end of
each quarterly period.  We have complied
with all of our maintenance financial ratios as required under our loan
covenants and other debt instruments.  In addition, we are required to comply
with certain financial ratios for the incurrence of capital expenditures in
excess of US$10 million and incurrence of indebtedness.</p>

<p style='text-indent:.25in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Please see <i>Note 17 &#150; Interest-bearing Financial
Liabilities </i>to the accompanying unaudited consolidated financial statements
for a detailed discussion of our covenants.</p>

<p style='text-indent:.25in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Financing Requirements</h2>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We believe that our available cash, including cash
flow from operations, will provide sufficient liquidity to fund our projected
operating, investment, capital expenditures and debt service requirements for
the next 12 months.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;text-autospace:none' style="margin-top:0;margin-bottom:0">Since 2002, we have been utilizing internally
generated cash, particularly from our cellular business, to reduce our overall
level of indebtedness.  In line with this objective, we have managed our
capital expenditures, reduced our investments and suspended dividend payments
to common shareholders from April 2001.  As a result of our improving cash
flows and reduced debt levels, we restored the payment of dividends in May 2005
and currently intend to gradually increase our dividend payout ratio in
succeeding years as we improve our leverage ratios.  For
2006, we are targeting a dividend payout ratio of 60%.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Credit
Ratings</i><b> </b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">None
of our existing indebtedness contains provisions under which credit rating
downgrades would trigger a default, changes in applicable interest rates or
other similar terms and conditions.  </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
current credit ratings are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:436.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b><u>Rating Agency</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b><u>Credit Rating</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b><u>Outlook</u></b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Standard and Poor&#146;s</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Foreign Currency Senior
 Unsecured Debt Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB+</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Moody&#146;s Investor Service</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Foreign Currency Senior
 Unsecured Debt Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Ba2</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Negative</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Local Currency Corporate
 Family Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Baa3</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Positive</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Fitch</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Foreign Currency
 Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Local Currency
 Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB+</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Foreign Currency
 Issuer Default Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Local Currency
 Issuer Default Rating</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BBB-</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Positive</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">National Long-term Rating </p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">AAA(ph1)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On March 29, 2006, Moody&#146;s Investor Service, or
Moody&#146;s, placed the Ba1 local currency corporate family rating of PLDT on
review for possible upgrade.  At the same time, Moody&#146;s affirmed PLDT&#146;s Ba2
foreign currency senior unsecured ratings, with a negative outlook.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
July 18, 2006, Moody&#146;s upgraded PLDT&#146;s local currency corporate family rating
from Ba1 to Baa3 with a positive outlook.  The upgrade has been prompted by
continued improvements in PLDT&#146;s credit profile, that it enjoys a lowly geared
balance sheet, 65% share in revenue terms of the market where only one major
competitor is present and has flexibility significant enough to invest its free
cash flows into upgrading its technology base.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;text-autospace:none' style="margin-top:0;margin-bottom:0">On February 20, 2006, Fitch Ratings has revised its
outlook on PLDT&#146;s long-term foreign currency from negative to stable.  PLDT&#146;s
long-term foreign currency, global bonds and senior notes has been affirmed at
&#147;BB&#148; and convertible preferred stock at &#147;B+.&#148;  The revision in outlook reflects
that of the outlook of the Republic of the Philippines as foreign currency and
senior debt instrument ratings are constrained by the sovereign foreign
currency rating.  At the same time, PLDT&#146;s long-term local currency rating has
been affirmed at &#147;BB+&#148; with a stable outlook.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
June 7, 2006, Fitch Ratings upgraded PLDT&#146;s long-term local currency Issuer
Default Rating, or IDR, to &#147;BBB-&#148; from &#147;BB+&#148; with a positive outlook.  At the
same time, Fitch affirmed PLDT&#146;s long-term foreign currency IDR of &#147;BB&#148; with a
stable outlook, reflecting the outlook on the Republic of the Philippines&#146; long-term foreign currency IDR of &#147;BB.&#148;  Following the licensing of Fitch to provide National
ratings in the Philippines, Fitch assigned PLDT a National long-term rating of
&#147;AAA(ph1)&#148; with a stable outlook.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Equity
Financing</i></p>

<p style='line-height:9.0pt;page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">PLDT raised Php43 million
and Php131 million from the exercise by certain officers and executives of
stock options in the first half of 2006 and 2005, respectively.  In addition,
through our subscriber investment plan, or SIP, which provides postpaid fixed
line subscribers the opportunity to buy shares of our 10% cumulative
convertible preferred stock as part of the upfront payments collected from
subscribers, PLDT was able to raise Php3 million and Php2 million in the first
half of 2006 and 2005, respectively.  </p>

<p style='line-height:9.0pt;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto;text-autospace:none' style="margin-top:0;margin-bottom:0">Cash
dividend payments in the first half of 2006 amounted to Php5,334 million, of
which Php5,099 million and Php235 million were paid to common and preferred
shareholders, respectively, compared to Php2,963 million, of which Php2,372
million and Php591 million were paid to common and preferred shareholders,
respectively, in the same period in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth dividend payments on
shares of PLDT&#146;s common stock for the year 2005 and for the six months ended
June 30, 2006:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='height:9.45pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=5 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:9.45pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:9.45pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Declaration</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Record</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Paid</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Common Stock</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 1, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 31, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 12, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php14.00</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,384</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 5, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">June 3, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">July 14, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,598</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">November 8, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">November 28, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 28, 2005</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,642</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 20, 2006</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">April 20, 2006</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28.00</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,059</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As at
June 30, 2006, there were 182,820,644 PLDT common shares outstanding.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Contractual Obligations and Commercial Commitments </i></b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Contractual Obligations</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table discloses our consolidated contractual
obligations outstanding as at June 30, 2006: </p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:104.44%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=9 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Payments Due by Period</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Within<br>
 1 year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2</b><b>-</b><b>3<br>
 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>4</b><b>-</b><b>5<br>
 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>After 5<br>
 years</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.35pt'>
 <td   style=' padding:0in 0in 0in 0in;height:7.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=9 style=' padding:0in 0in 0in 0in;
 height:7.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Long-term debt (1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php98,367</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php18,449</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php26,537</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,163</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php44,218</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Long-term lease obligations:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating lease</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,435</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">606</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,067</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">815</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">947</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capital lease</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,670</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,001</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">223</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">427</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unconditional purchase obligations(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,815</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,961</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,129</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,129</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,596</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other long-term obligations</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,389</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,115</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,274</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total contractual obligations</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php126,676</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php25,017</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,071</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php19,400</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php47,188</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:12.0pt;page-break-after:avoid;
border:none' style="margin-top:0;margin-bottom:0">___________</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Before deducting unamortized
debt discount and debt issuance costs.</i></p>

<p style='line-height:3.0pt' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Based on the original Air
Time Purchase Agreement with AIL.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Debt </i></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For a discussion of our long-term debt, see <i>Note 17 &#150; Interest-bearing Financial Liabilities </i>to the accompanying unaudited consolidated financial
statements.</p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Operating Lease Obligations</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>Digital
Passage Service Contracts</i></b>.<b>   </b>PLDT
has existing Digital Passage Service Contracts with foreign telecommunication
administrations for several dedicated circuits to various destinations for ten
to 25 years expiring at various dates.  As at June 30, 2006, PLDT&#146;s aggregate
remaining obligation under these contracts amounted to approximately Php12
million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>License
Agreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius</i></b><i>.  </i>PLDT
entered into a license agreement with Mobius pursuant to which Mobius has
granted PLDT a non-exclusive, non-assignable and non-transferable license for
the use of computer software components.  Under this agreement, Mobius is also
required to provide maintenance services for a period of one year at no
additional maintenance charge.  PLDT may purchase maintenance services upon
expiration of the first year for a fee of 15% of the current published license
fee.  As at June 30, 2006, PLDT&#146;s aggregate remaining obligation under this
agreement was approximately Php20 million.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>Other
Long-term Operating Lease Obligations</i></b>.  The PLDT Group has various long-term lease contracts for periods
ranging from two to ten years covering certain offices, warehouses, cell sites,
telecommunication equipment locations and various office equipment.  In
particular, Smart has lease obligations aggregating Php3,171 million as at June
30, 2006 in respect of office and cell site rentals with over 3,000 lessors
nationwide, PLDT has lease obligations aggregating Php100 million as at June 30,
2006, and ePLDT has lease obligations aggregating Php132 million as at <br>
June 30, 2006 in respect of certain office space rentals.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Capital Lease Obligation</i>s</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For a discussion of our long-term capital lease
obligations, see <i>Note 17 &#150;
Interest-bearing Financial Liabilities </i>to
the accompanying unaudited consolidated financial statements.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Unconditional
Purchase Obligations</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>Air
Time Purchase Agreement with AIL</i></b>.
PLDT is a party to a Founder NSP, or National Service Provider, Air Time
Purchase Agreement entered into with ACeS International Limited, or AIL, in
March 1997, which was amended in December 1998, under which PLDT was granted
the exclusive right to sell AIL services in the Philippines.  In exchange, the
Air Time Purchase Agreement required PLDT to purchase from AIL a minimum of
US$5 million worth of air time annually over ten years commencing on January 1,
2002, the purported date of commercial operations of the Garuda I Satellite.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
the event that AIL&#146;s aggregate billing revenue is less than US$45 million in
any given year, the Air Time Purchase Agreement also states that PLDT has to
make supplemental air time purchase payments not to exceed US$15 million per
year during the ten-year term. </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">PLDT and the other
founder NSPs are endeavoring to amend the Air Time Purchase Agreement due to
the occurrence of partial satellite loss, changes in the primary business of ACeS
and other events affecting the business.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In March 2003, PLDT, together with the other founder
NSPs, entered into a Standstill Agreement with AIL suspending the application
and enforcement of the minimum and supplemental air time payments under the
original Air Time Purchase Agreement.  The parties agreed that AIL shall
provide PLDT and the other founder shareholders with unlimited use of air time
for the year 2003 in exchange for a fixed fee in the amount of US$3.8 million
for PLDT.  Moreover, PLDT was also obliged to purchase from AIL 13,750
satellite phone units in 2003 at US$395 F.O.B. per unit, subject to quarterly
price adjustments.  The parties to the Standstill Agreement also agreed to
negotiate in good faith and use their best efforts to reach an agreement on a
revised Air Time Purchase Agreement before November 15, 2003 that would cover,
among other things, the amended minimum and supplemental air time payment
provisions subject to the approval of AIL&#146;s creditors.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">On February 10, 2004,
notwithstanding the ongoing negotiations, AIL advised PLDT of the termination
of the Standstill Agreement and the reinstatement of the terms under the
original Air Time Purchase Agreement effective January 1, 2002 following the
lapse of the November 15, 2003 deadline set in the Standstill Agreement for the
negotiation of a revised Air Time Purchase Agreement.  Negotiations are
continuing with the relevant parties towards an amicable settlement of this
matter.  See <i>Note 20 &#150; Related Party Transactions</i> and <i>Note 23 &#150;
Provisions and Contingencies</i> to the accompanying unaudited consolidated
financial statements for further details relating to the Air Time Purchase
Agreement with AIL.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006,
PLDT&#146;s aggregate remaining minimum obligation under the original Air Time
Purchase Agreement was approximately Php10,815 million.  </p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Obligations</i></p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>Mandatory
Conversion and Purchase of Shares</i></b>.
As discussed in <i>Note 17 &#150; Interest-bearing Financial Liabilities </i>to the
accompanying unaudited consolidated financial statements, as at June 30, 2006,
PLDT had issued a total of 3 million shares of Series V Convertible Preferred
Stock, 5 million shares of Series VI Convertible Preferred Stock and 4 million
shares of Series VII Convertible Preferred Stock in exchange for a total of 58
million shares of Series K Class I Convertible Preferred Stock of Piltel,
pursuant to the debt restructuring plan of Piltel adopted in June 2001.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Each
share of Series V, VI and VII Convertible Preferred Stock is convertible at any
time at the option of the holder into one PLDT common share.  On the date
immediately following the seventh anniversary of the issue date of the Series V
and Series VI Convertible Preferred Stocks and on the eighth anniversary of the
issue date of the Series VII Convertible Preferred Stock, the remaining
outstanding shares under these series will be mandatorily converted to PLDT
common shares.  Under a put option exercisable for 30 days, holders of common
shares received on mandatory conversion of the Series V, VI and VII Convertible
Preferred Stocks will be able to require PLDT to purchase such PLDT common
shares for Php1,700 per share, US$36.132 per share, and JP&yen;4,071.89 per share,
respectively.</p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, 2,668,962 shares of Series V Convertible Preferred Stock and 2,681,644
shares of Series VI Convertible Preferred Stock had been converted to PLDT
common shares.  As at June 30, 2006, 52,478 shares of Series V, 2,613,460
shares of Series VI and 3,842,000 shares of Series VII Convertible Preferred
Stocks remained outstanding.  The aggregate value of the put option based on
outstanding shares as at June 30, 2006 was Php12,389 million, of which Php5,115
million is puttable on June 4, 2008 and Php7,274 million on June 4, 2009, if
all of the outstanding shares of Series V, VI and VII Convertible Preferred
Stocks were mandatorily converted and all the underlying shares of common stock
were put to PLDT.  The market value of the underlying shares of common stock
was Php11,910 million, based on the market price of PLDT common shares of Php1,830
per share as at June 30, 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Please refer to <i>Note 17 &#150; Interest-bearing
Financial Liabilities </i>to the accompanying unaudited consolidated financial
statements for further discussion.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Commercial Commitments</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006,
our outstanding commercial commitments, in the form of letters of credit,
amounted to Php1,836 million.  These commitments will expire within one year.</p>

<p style='line-height:13.0pt;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>Quantitative and
Qualitative Disclosures about Market Risks</b></p>

<p style='line-height:13.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Our operations are
exposed to various risks, including liquidity risk, foreign exchange risk and
interest rate risk.  The importance of managing these risks has significantly
increased in light of considerable change and continuing volatility in both the
Philippine and international financial markets.  With a view to managing these
risks, we have incorporated financial risk management functions in our
organization, particularly in our treasury operations and equity issues and
sales of certain assets.</p>

<p style='line-height:13.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Liquidity Risk Management</h3>

<p style='text-indent:.5in;line-height:13.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We seek to manage our liquidity profile to be able
to finance our capital expenditures and service our maturing debts.  To cover
our financing requirements, we intend to use internally generated funds and
proceeds from debt and equity issues and sales of certain assets. </p>

<p style='text-indent:.5in;line-height:13.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As part of our liquidity
risk management program, we regularly evaluate our projected and actual cash
flow information and continuously assess conditions in the financial markets
for opportunities to pursue fund-raising initiatives.  These initiatives may
include bank loans, export credit agency-guaranteed facilities, and debt
capital and equity market issues.</p>

<p style='text-indent:.5in;line-height:13.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK9"><b><i>Foreign
Exchange Risk Management</i></b></a></p>

<p style='text-indent:.5in;line-height:13.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006,
the Philippine peso had depreciated by Php0.158 against the U.S. dollar to Php53.220
to US$1.00 from Php53.062 to US$1.00 as at December 31, 2005.  As at June 30,
2005, on the other hand, the peso appreciated by Php0.164 to Php56.177 to
US$1.00 from Php56.341 to US$1.00 as at December 31, 2004.  As at June 30, 2006,
the Philippine peso had depreciated by 3% against the Japanese yen to Php0.4650
to JP&yen;1 from Php0.4504 to JP&yen;1 as at December 31, 2005.  On the other hand, as
at June 30, 2005, the peso appreciated by 8% to Php0.5067 to JP&yen;1 from Php0.5495
to JP&yen;1 as at December 31, 2004.  The revaluation of our foreign-currency
denominated assets and liabilities is recognized as foreign exchange gains or losses
as at balance sheet date.  Since substantially all of our indebtedness is
denominated in U.S. dollars and Japanese yen, the depreciation of the peso has
resulted to the recognition of foreign exchange losses.  The extent of foreign
exchange gains or losses is largely dependent on the amount of foreign currency
debt we carry.  As at June 30, 2006, consolidated foreign currency
debt-denominated amounted to Php88,865 million, a reduction from Php101,423
million last December 31, 2005.  As such, we recognized foreign exchange loss of
Php195 million in the first half of 2006 as compared to foreign exchange gains
of Php1,382 million recorded in the same period in 2005.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">While
a certain percentage of our revenues is either linked to or denominated in U.S.
dollars, substantially all of our indebtedness and related interest expense, a
substantial portion of our capital expenditures and a portion of our operating
expenses are denominated in foreign currencies, mostly in U.S. dollars.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK31">As at June 30, 2006, approximately 98% of our total
consolidated debts were denominated in foreign currencies, principally in U.S.
dollars.  Of our foreign currency-denominated debts, 3% are in Japanese yen on
a consolidated basis and the balance in U.S. dollars.  Thus, a weakening of the
Philippine peso against the U.S. dollar or Japanese yen will increase both the
principal amount of our unhedged foreign currency-denominated debts
(representing 50% of our consolidated debts, or 35% net of our U.S. dollar cash
balances as at June 30, 2006), and interest expense on our debt in peso terms.
In addition, many of our financial ratios and other financial tests will be
negatively affected.  If, among other things, the value of the Philippine peso
against the U.S. dollar substantially drops from its current level, we may be
unable to maintain compliance with these ratios, which could result in
acceleration of some or all of our indebtedness.  For further information on
our loan covenants, see &#147;Liquidity and Capital Resources &#150; Financing Activities
&#150; Covenants&#148; above and <i>Note 17 &#150; Interest-bearing Financial Liabilities </i>to
the accompanying unaudited consolidated financial statements.</a></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">To manage our foreign exchange
risks, stabilize cash flows, and improve investment and cash flow planning, we
enter into forward foreign exchange contracts, foreign currency swap contracts,
currency option contracts and other hedging products aimed at reducing and/or
managing the adverse impact of changes in foreign exchange rates on our
operating results and cash flows.  However, these hedges do not cover all of
our exposure to foreign exchange risks.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Specifically,
we use forward foreign exchange contracts, foreign currency swap contracts and
currency option contracts to manage the foreign currency risk associated with
our foreign currency-denominated loans.  In order to manage hedge costs of
these contracts, we utilize structures that include credit-linkage with PLDT as
the reference entity, a combination of currency option contracts, and fixed to
floating coupon only swap agreements.  Accounted as either cash flow hedges or
transactions not designated as hedges, changes in the fair value of these
instruments are recognized as cumulative translation adjustments in equity
until the hedged item is recognized in earnings or directly to income for the
period.  As at June 30, 2006, PLDT&#146;s outstanding forward foreign exchange
contracts, principal-only long-term cross-currency swap contracts and currency
option contracts amounted to US$158 million and JP&yen;1,516 million; US$550
million; and US$175 million, respectively.  Smart has no outstanding forward
foreign exchange contracts as at June 30, 2006. </p>

<p style='text-indent:0in;page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For further discussions of these contracts, see <i>Note
24 &#150; Financial Assets and Liabilities &#150; Derivative Financial Instruments </i>to
the accompanying unaudited consolidated financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Interest Rate Risk
Management</i></b></p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">On a limited basis, we
enter into interest rate swap agreements in order to manage our exposure to
interest rate fluctuations.  As at June 30, 2006, PLDT&#146;s outstanding interest
rate swap contracts amounted to US$63 million.  For further discussions of
these contracts, see <i>Note 24 &#150; Financial Assets and Liabilities &#150; Derivative
Financial Instruments </i>to the accompanying unaudited consolidated financial
statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
make use of hedging instruments and structures solely for reducing or managing financial
risks associated with our liabilities and not for trading or speculative purposes.</p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><b>Impact of Inflation and
Changing Prices</b></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Inflation can be a
significant factor in the Philippine economy, and we are continually seeking
ways to minimize its impact.  In recent periods, we do not believe inflation
has had a material impact on our operations.  The average inflation rate in the
 Philippines in the first half of 2006 was 7.1%, compared to 8.3% in the same
period in 2005.</p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PART II &#150; OTHER INFORMATION</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0"><b><i>PLDT launched fiber optic link to Baguio City</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.5in' style="margin-top:0;margin-bottom:0">On July 28, 2006, we launched the first DFON link connecting Baguio City to PLDT&#146;s nationwide fiber optic network.  The fiber optic link has a capacity
of 10 gigabit per second of transmission bandwidth equivalent to 120,960
simultaneous voice calls.  It will support the city&#146;s growing demand for voice,
data and video traffic and would further boost Baguio&#146;s tourism industry and
ICT potential.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>ePLDT&#146;s Acquisition of
SPi Technologies</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.5in' style="margin-top:0;margin-bottom:0">On July 11, 2006, ePLDT completed the acquisition of 100% of
SPi and its direct and indirect Philippine and offshore subsidiaries for a
total consideration of US$135.34 million from SPi&#146;s sole shareholder, SPi Tech
L.P., or SPi Tech.&nbsp; The acquisition of SPi, combined with <i>ePLDT Ventus</i>,
creates the largest full service business process outsourcing in the Philippines.&nbsp; As part of the transaction, ePLDT also acquired a US$7 million debt owed
by SPi to SPi Tech at face value.&nbsp; In addition, ePLDT advanced US$16.43
million to SPi in order for SPi to fully pay its debt owed to DBS Bank Singapore.&nbsp; ePLDT intends to have this debt refinanced by SPi in due course.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Smart&#146;s 20% Acquisition of WolfPac</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On May 8, 2006, Smart signed a share purchase
agreement to acquire the remaining 20% equity interest in Wolfpac, a company
engaged in the business of consumer mobile applications software development
and content development.&nbsp; Smart acquired 80% equity interest in Wolfpac in
October 2003.  The remaining 20% equity interest in Wolfpac was paid in July
2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Related Party Transactions</i></h6>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Cooperation Agreement with the First Pacific, or FP, Parties, NTT
Communications and DoCoMo</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
connection with the transfer by NTT Communications of approximately 12.6
million shares of PLDT&#146;s common stock to DoCoMo pursuant to the Stock Sale and
Purchase Agreement dated January 31, 2006 between NTT Communications and
DoCoMo, the FP Parties, NTT Communications and DoCoMo entered into a
Cooperation Agreement, dated January 31, 2006.  Under the Cooperation
Agreement, the relevant parties extended certain rights of NTT Communications under
the Stock Purchase and Strategic Investment Agreement dated <br>
September 28, 1999, as amended and the Shareholders Agreement dated March 24,
2000, to DoCoMo, including:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
certain contractual veto rights
over a number of major decisions or transactions; and</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
rights relating to the
representation on the board of directors of PLDT and Smart, respectively, and
any committees thereof.</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Key provisions of the Cooperation Agreement pertain
to, among other things: restriction on ownership of shares of PLDT by NTT
Communications and DoCoMo, limitation on competition, business cooperation, additional rights of DoCoMo, change in control and termination.
 Please see <i>Note 20 &#150; Related Party Transactions</i> to the accompanying
unaudited consolidated financial statements for further details.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Integrated i-mode Services
Package Agreement between DoCoMo and Smart &#150; </i>the Integrated i-mode Service
Package Agreement was entered into by Smart and DoCoMo on February 15, 2006,
under which DoCoMo agreed to grant Smart, on an exclusive basis within the territory
of the Philippines for a period of five years, an integrated i-mode service
package including non-transferable license to use the licensed materials and
the i-mode brand, as well as implementation support and assistance and
post-commercial launch support from DoCoMo.  Pursuant to this agreement, Smart
is required to pay an initial license fee and running royalty fees based on the
revenue arising from i-mode subscription fees and data traffic.  The initial
license fee paid as at June 30, 2006 amounted to US$1 million or Php53 million.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Advisory Services Agreement between DoCoMo and PLDT</i> &#150; the Advisory Services Agreement was entered into by
DoCoMo and PLDT on June 5, 2006, in accordance with the Cooperation Agreement
between PLDT and DoCoMo.  Pursuant to the agreement, DoCoMo will provide the services
of certain key personnel in connection with certain aspects of the business of
PLDT and Smart.  Also, the agreement governs the terms and conditions of the
appointments and the corresponding fees related thereto.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Other Agreements with NTT
Communications and/or its Affiliates </i>&#151;
agreements under which <br>
(1) NTT Communications provides advisory services for various business areas of
PLDT; (2) NTT World Engineering Marine Corporation provides maintenance services
to PLDT&#146;s DFON; (3) PLDT is licensed to market managed data and other services
using NTT Communications&#146; Arcstar brand; and (4) PLDT and NTT Communications
agreed to cooperative arrangements for conventional international
telecommunication services.  Total fees under these agreements totaled Php100 million
and Php114 million for the six months ended June 30, 2006 and 2005,
respectively.  PLDT&#146;s outstanding obligations under these agreements amounted
to Php40 million and Php23 million as at June 30, 2006 and December 31, 2005,
respectively.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Agreements between Smart
and Asia Link B.V</i>. &#151; agreements under
which Asia Link undertakes to provide technical support services and assistance
in the operations and maintenance of Smart&#146;s cellular business.  Total fees under
these agreements totaled Php299 million and Php278 million for the six months ended
June 30, 2006 and 2005, respectively.  Outstanding obligations of Smart under
the Technical Service Agreement amounted to Php30 million and Php194 million as
at June 30, 2006 and December 31, 2005, respectively.  Asia Link is a
subsidiary of the First Pacific Group.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Agreements relating to
insurance companies</i> &#151; Gotuaco del
Rosario and Associates, or Gotuaco, acts as the broker for certain insurance
companies to cover certain insurable properties of the PLDT Group.  Insurance
premiums are remitted to Gotuaco and the broker&#146;s fees are settled between
Gotuaco and the insurance companies.  In addition, PLDT has an insurance policy
with Malayan Insurance Co., Inc., or Malayan, wherein premiums are directly
paid to Malayan.  Total insurance expenses paid under these agreements amounted
to Php189 million and Php268 million for the six months ended June 30, 2006 and
2005, respectively.  Two directors of PLDT have a direct/indirect interest in
or serve as a director/officer of Gotuaco and Malayan.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-right:4.3pt;text-align:left' style="margin-top:0;margin-bottom:0">For a more detailed discussion of the related party
transactions enumerated above, see <i>Note 20 &#150;Related Party Transactions</i>
to the accompanying<i> </i>unaudited<i> </i>consolidated financial statements.
</p>

</div>

<br clear=all
style='page-break-before:always'>

<div>

<p style="margin-top:0;margin-bottom:0">SIGNATURES</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;text-indent:.5in' style="margin-top:0;margin-bottom:0">Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">PHILIPPINE LONG DISTANCE TELEPHONE COMPANY</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:234.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">By:       /s/  Ma. Lourdes C. Rausa-Chan</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Ma. Lourdes C. Rausa-chan</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Senior
 Vice President, Corporate Affairs and Legal Services Head and Corporate
 Secretary</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
</table></center></div>

<p style='text-align:justify;text-indent:3.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;text-indent:3.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;text-indent:3.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Date:  August 8, 2006</p>

<p align=left style='margin-right:4.3pt;text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<b><br clear=all
style='page-break-before:auto'>
</b>

<div></div>

<b><br clear=all
style='page-break-before:always'>
</b>

<div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED FINANCIAL STATEMENTS</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">AS AT JUNE 30, 2006 (UNAUDITED) AND DECEMBER 31, 2005
(AUDITED)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">AND FOR THE SIX MONTHS ENDED JUNE 30, 2006 AND 2005
(UNAUDITED)</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">CONSOLIDATED
BALANCE SHEETS</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>(in million pesos, except par value and share amounts)</b></p>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.66%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:6.6pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.6pt'>
 <p style='margin-top:2.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:6.6pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,<br>
 2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:6.6pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:6.6pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December
 31, 2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(Unaudited)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Audited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:17.05pt'>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:17.05pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b><u>ASSETS</u></b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:17.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:17.35pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Assets</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:17.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:17.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:17.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Property, plant and equipment (Notes 2, 8 and 17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>173,832</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">176,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in associates (Notes 2, 9 and 17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>445</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments-available-for-sale (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>111</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investment properties (Notes 2 and 10)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>691</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">701</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Goodwill and intangible assets (Notes 2, 3 and 11)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,312</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,049</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Deferred income tax assets (Notes 2 and 6)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,059</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,457</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Derivative assets (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,081</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Notes receivable (Notes 2, 12 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>346</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Prepayments - net of current portion</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,036</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,062</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Advances and refundable deposits - net of current portion (Note
 2)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,400</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,070</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.05pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.05pt'>
 <p style='margin-left:22.9pt' style="margin-top:0;margin-bottom:0">Total Noncurrent Assets </p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>200,313</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">201,431</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:15.7pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.7pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:15.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:15.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Cash and cash
 equivalents (Notes 2, 13 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25,966</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,064</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Short-term investments (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,172</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,746</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Trade and other receivables (Notes 2, 14 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,844</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,113</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Inventories and supplies (Notes 2 and 15)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,662</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,548</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Derivative assets (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current portion of prepayments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,581</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,259</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current portion of advances and refundable deposits (Notes
 2 and 20)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>218</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,515</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p style='margin-left:22.9pt' style="margin-top:0;margin-bottom:0">Total Current
 Assets </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>44,458</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,282</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:12.1pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>244,771</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">249,713</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.85pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.85pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:17.35pt'>
 <td   colspan=4 valign=bottom style=' padding:0in 0in 0in 0in;
 height:17.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><a name=equity></a><b><u>EQUITY AND LIABILITIES</u></b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.3in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.3in'>
 <p style="margin-top:0;margin-bottom:0"><b>Equity</b><b> Attributable to Equity Holders of PLDT </b>(Notes
 2, 7 and 16)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.3in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.3in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.3in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Preferred stock, Php10 par value, authorized-822,500,000 shares;
 issued and <br>
 outstanding-442,966,220 shares as at June 30, 2006 and 443,343,035 shares <br>
 as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,430</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,433</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.7pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Common stock, Php5 par value, authorized-234,000,000 shares;
 issued and <br>
 outstanding-182,820,644 shares as at June 30, 2006 and 180,789,003 shares <br>
 as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>914</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Stock options issued (Note 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>48</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Equity portion of convertible preferred stock (Note 17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Capital in excess of par value</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>57,202</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53,918</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Retained earnings (Note 7)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>22,773</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,583</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Cumulative translation adjustments (Note
 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,006)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,253</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.05pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.05pt'>
 <p style="margin-top:0;margin-bottom:0">                Total Equity Attributable to Equity Holders of
 PLDT</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>84,371</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">73,207</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.6pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Minority interest</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,499</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,162</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='margin-left:22.9pt' style="margin-top:0;margin-bottom:0">Total Equity</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>85,870</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,369</p>
 </td>
 </tr>
</table></center></div>

<br clear=all
style='page-break-before:always'>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">CONSOLIDATED
BALANCE SHEETS (<i>continued</i>)</p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">(in million pesos, except par value and share amounts)</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.66%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:10.2pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.2pt'>
 <p style='margin-top:2.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,<br>
 2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(Unaudited)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Audited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:16.6pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.6pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:16.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.3pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities - net of current portion
 (Notes 2, 8, 17, 22 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>82,533</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97,215</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Deferred income tax liabilities (Notes 2 and 6)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>39</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.65pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p style="margin-top:0;margin-bottom:0">Derivative liabilities (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,918</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.3pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Provisions
 for onerous contracts and assessments - net of current portion <br>
 (Notes 20, 22 and 23)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,096</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,966</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Pension and
 other employee benefits (Notes 2 and 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,544</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,252</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Customers&#146;
 deposits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,205</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,215</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Other
 noncurrent liabilities (Notes 2, 8, 14 and 18)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,852</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,600</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.1pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.1pt'>
 <p style='margin-left:22.9pt' style="margin-top:0;margin-bottom:0">Total Noncurrent
 Liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>109,187</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">121,074</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:15.85pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:15.85pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:15.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:15.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:15.85pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style="margin-top:0;margin-bottom:0">Accounts payable (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>11,295</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,482</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Accrued
 expenses and other current liabilities (Notes 2, 17, 19 and 20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,097</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,306</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Unearned revenues (Note 2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,353</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,656</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:5.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p style="margin-top:0;margin-bottom:0">Derivative liabilities (Notes 2 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>66</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:5.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Current
 portion of provisions for onerous contracts and assessments <br>
 (Notes 20, 22 and 23)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>427</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">408</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:5.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p style="margin-top:0;margin-bottom:0">Current portion of interest-bearing
 financial liabilities (Notes 2, 8, 17, 22 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>19,109</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,401</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.05pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.05pt'>
 <p style="margin-top:0;margin-bottom:0">Dividends payable (Notes 2, 7, 17 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>546</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">746</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style="margin-top:0;margin-bottom:0">Income tax payable (Notes 2 and 6)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,821</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,079</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='margin-left:22.9pt' style="margin-top:0;margin-bottom:0">Total Current
 Liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>49,714</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">54,270</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.45pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>244,771</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">249,713</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:30%' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>See accompanying Notes to
Unaudited Consolidated Financial Statements.</i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED STATEMENTS OF INCOME</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in million pesos, except per share amounts)</b></p>

<p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.74%;border-collapse:collapse;width:100.74% !msorm;border-collapse:
 collapse !msorm'>
 <tr style='page-break-inside:avoid;height:9.0pt' style='page-break-inside:
 avoid !msorm;height:9.0pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;border-top:
 solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=right style='margin-top:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=center style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.05pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=center style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.05pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Three Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:1.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:1.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-top:1.0pt;;
 margin-bottom:0in;margin-left:.15pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:16.2pt' style='page-break-inside:
 avoid !msorm;height:16.2pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:16.2pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>INCOME</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:16.2pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:16.2pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:16.2pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:16.2pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Service revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>60,640</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">59,543</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>30,662</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,268</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service revenues (Note
 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,383</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,422</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>674</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">607</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Equity share in net income
 of associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Other income (Notes 4 and 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>335</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>205</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">118</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>62,361</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61,138</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>31,542</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,994</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:14.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:14.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>EXPENSES</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:14.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:14.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:14.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:14.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and
 amortization (Notes 4 and 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,485</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,861</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,818</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,305</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits
 (Notes 5 and 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,616</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,492</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,972</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,406</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing costs (Notes 5,
 8, 17 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,135</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,824</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,134</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,545</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Maintenance (Note 20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,286</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,320</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,632</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,776</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,524</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,770</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,267</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,318</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of sales (Notes 5, 20
 and 22)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,460</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,271</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,225</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,267</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other
 contracted services (Note 20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,239</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,120</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>655</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">663</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent (Note 22)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,146</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">954</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>600</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">324</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses (Note
 23)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>914</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,015</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>363</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">451</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provisions (Notes 4, 5, 14,
 15, 20, 22 and 23)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>770</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,987</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>532</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,379</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and
 travel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>673</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">744</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>311</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">392</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security
 services (Note 20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>659</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">825</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>325</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">414</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible
 assets (Note 11)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>140</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>72</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other expenses (Notes 5 and
 20)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>689</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">781</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>283</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">365</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.6pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>43,736</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">39,103</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>24,189</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21,673</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>INCOME BEFORE INCOME TAX</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,625</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,035</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,353</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,321</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>PROVISION FOR INCOME TAX</b> (Notes 2 and 6)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,986</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,483</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>477</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,008</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>NET INCOME FOR THE PERIOD</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,639</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,876</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,313</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>ATTRIBUTABLE TO:</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.35pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-.35pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:.05pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Equity holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,306</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,725</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,303</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:.05pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Minority interest</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>333</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>151</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,639</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,876</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,313</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.45pt' style='page-break-inside:
 avoid !msorm;height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:13.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Earnings Per Common
 Share</b> (Note 7)</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.35pt;text-indent:.05pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>83.02</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">92.44</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36.28</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40.51</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:9.35pt;text-indent:.05pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>83.00</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">87.88</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36.28</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40.51</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:30%;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>See accompanying Notes to</i><i> Unaudited Consolidated Financial Statements.</i></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p align=center style='margin-top:3.0pt;margin-right:.7pt;
margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY AND SUBSIDIARIES</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-right:.9pt;text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED
STATEMENTS OF CHANGES IN EQUITY</b></p>

<p align=center style='margin-right:.9pt;text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in million pesos)</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:102.0%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Preferred<br>
 Stock</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Common<br>
 Stock </b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Stock Options
 Issued</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Equity Portion of
 Convertible Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Capital in<br>
 Excess of <br>
 Par Value </b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Retained<br>
 Earnings (Deficit)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Cumulative
 Translation Adjustments</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Equity Attributable
 to Equity Holders of PLDT</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Minority Interest</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total <br>
 Equity</b></p>
 </td>
 </tr>

 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Balances at January 1, 2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,497</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>851</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>181</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>448</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>50,469</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(10,479)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>362</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>46,329</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>857</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>47,18</b><b>6</b></p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Income for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Currency translation differences (Note
 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net gains on available-for-sale
 financial assets <br>
 (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net loss on cash flow hedges (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(500)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(500)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(500)</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total income and expense for the period
 recognized directly to equity</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(496)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(496)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(496)</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total income and expense for the
 period</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,520</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(496)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,024</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>32</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,056</b></p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Cash dividends</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(6,682)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(6,682)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(6,682)</b></p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Issuance of capital stock - net (Note
 16)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(10)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(187)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,230</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,038</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,038</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Exercised shares</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(57)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>187</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>131</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>131</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Minority interest</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(7)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(7)</b></p>
 </td>
 </tr>
 <tr style='height:8.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Balances at June 30, 2005</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,4</b><b>87</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 85</b><b>7</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>124</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>261</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>51,886</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(641)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(134)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>56,840</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>882</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>57,722</b></p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Balances at January 1, 2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,433</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>904</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>67</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>49</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>53,918</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>12,583</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,253</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>73,207</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,162</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>74,369</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Changes in equity:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-top:0in;margin-right:2.15pt;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Income for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,306</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,306</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">333</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,639</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Currency translation differences (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net gains on available-for-sale
 financial assets <br>
 (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net loss on cash flow hedges (Note 24)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,265)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,265)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,265)</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-top:0in;margin-right:2.15pt;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total income and expense for the period
 recognized directly to equity</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,259)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,259)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,257)</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total income and expense for the
 period</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,</b><b>306</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(2,259)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,047</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>335</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,382</b></p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Cash dividends</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,116)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,116)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,116)</b></p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Issuance of capital stock - net (Note
 16)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(3)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(39)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,222</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,190</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,190</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Exercised shares (Note 21)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-top:0in;margin-right:2.15pt;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(19)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>62</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> </b><b>43</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>43</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Minority interest</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2</b></p>
 </td>
 </tr>
 <tr style='height:8.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Balances at June 30, 2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,43</b><b>0</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 9</b><b>14</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>48</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>57,202</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>22,773</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(</b><b>1,006)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>84,371</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,499</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>85,870</b></p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:30%;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>See accompanying Notes to Unaudited Consolidated Financial Statements.</i></p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED STATEMENTS OF CASH FLOWS</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>(in million pesos)</b></p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.74%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:2.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;;
 margin-bottom:0in;margin-left:45.0pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:12.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:12.1pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS
 FROM OPERATING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:12.1pt'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:12.1pt'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Income before
 income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,625</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">22,035</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0">Adjustments
 for:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization
 (Note 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,485</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,861</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest on loans and related
 items - net of capitalized interest (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,053</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,453</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accretion on financial
 liabilities - net (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,823</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,509</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts
 (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>435</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,526</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Foreign exchange loss (gains) -
 net (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>195</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,382)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Write-down of
 inventories to net realizable values (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>186</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">325</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Provisions for onerous contracts
 and assessments (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>149</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">136</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Amortization of intangible
 assets (Note 11)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>140</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Dividends on preferred stock
 subject to mandatory redemption (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>93</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Loss (gain) on derivative
 transactions - net (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>23</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(778)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Equity share in net income of
 associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest income (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(837)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(741)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(20)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Operating
 income before working capital changes</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>40,347</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">39,275</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Decrease (increase) in:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,115)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">466</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Inventories and supplies</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,215)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(463)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Prepayments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(560)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(554)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Advances and refundable deposits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,298</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(260)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Increase (decrease) in:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,401)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,872)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Accrued expenses and other
 current liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>916</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,888</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>658</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(252)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Pension and other employee
 benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,289</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">794</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Net cash generated from operations</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>37,217</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">39,022</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Income taxes paid</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,616)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,871)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Net cash provided by operating activities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,601</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">35,151</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS
 FROM INVESTING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:.4pt;text-indent:-.4pt' style="margin-top:0;margin-bottom:0">Additions to
 property, plant and equipment</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(12,083)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(6,809)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Proceeds from
 disposal of property, plant and equipment</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>300</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Interest paid
 &#150; capitalized to property, plant and equipment (Notes 5 and 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(302)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(203)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style="margin-top:0;margin-bottom:0">Payments for purchase of investments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,977)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(238)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Proceeds from sale of investment properties</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>13</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Payments for purchase of investments-available-for sale</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Increase (decrease) in short-term investments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(425)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,846</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Investments in notes receivable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(60)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Interest received</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>810</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">747</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Decrease (increase) in advances and refundable deposits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(234)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:7.75pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.75pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.75pt'>
 <p style="margin-top:0;margin-bottom:0">Net cash used in investing activities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(13,898)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,220)</p>
 </td>
 </tr>
</table></center></div>

<br clear=all
style='page-break-before:always'>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED STATEMENTS OF CASH FLOWS (<i>continued</i>)</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.74%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-top:2.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-top:2.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=center style='margin-top:1.0pt;;
 margin-bottom:0in;margin-left:45.0pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.4pt;margin-bottom:.0001pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS
 FROM FINANCING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-top:3.0pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Proceeds from availment of long-term debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,446</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-top:1.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">5,471</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Payments of long-term
 debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(17,826)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(22,187)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Payments of debt
 issuance costs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(133)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Proceeds from notes payable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>129</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">251</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Payments of notes payable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(128)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(254)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Payments of obligations under capital lease</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(89)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(43)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Interest paid - net of capitalized portion</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,977)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5,542)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Settlements of derivatives</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,405)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(660)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Cash dividends paid</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(5,334)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,963)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style="margin-top:0;margin-bottom:0">Proceeds from issuance of capital stock</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>46</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Increase
 (decrease) in:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:9.0pt;text-indent:.4pt' style="margin-top:0;margin-bottom:0">Customers&#146;
 deposits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(30)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p style='margin-left:9.0pt;text-indent:.4pt' style="margin-top:0;margin-bottom:0">Other
 noncurrent liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,197</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,429</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0">Net cash used in financing activities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(23,943)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(24,528)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>EFFECT OF
 EXCHANGE RATE CHANGES ON CASH AND <br>
 CASH EQUIVALENTS</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>142</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(95)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>NET
 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,098)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,308</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>CASH AND
 CASH EQUIVALENTS AT BEGINNING OF PERIOD</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>30,064</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">27,321</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>CASH AND
 CASH EQUIVALENTS AT END OF PERIOD</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>25,966</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">35,629</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:30%;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>See
accompanying Notes to Unaudited Consolidated Financial Statements.</i></p>

<p style='margin-left:9.0pt;text-align:justify;text-indent:
- -9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPH</b><b>ONE COMPANY AND SUBSIDIARIES</b></p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</b></p>

<p style='page-break-after:auto;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.25in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0"><b>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Corporate
Information</b></p>

<p align=left style='margin-left:.25in;text-align:left;page-break-after:
auto;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
Philippine Long Distance Telephone Company, or PLDT, or Parent Company, was
incorporated under the old Corporation Law of the Philippines (Act 1459, as
amended) on November 28, 1928, following the merger of four telephone companies
under common ownership by United States entities.  In 1967, effective control
of PLDT was sold by General Telephone and Electronics Corporation <br>
(a major shareholder since PLDT&#146;s incorporation) to a group of Filipino
businessmen.  In 1981, in furtherance of the then existing policy of the
Philippine government to integrate the Philippine telecommunications industry,
PLDT purchased substantially all of the assets and liabilities of the Republic
Telephone Company, which at that time was the second largest telephone company
in the Philippines.  In 1998, First Pacific Company Limited, or First Pacific,
through its Philippine and other affiliates, acquired a significant interest in
PLDT.  On March 24, 2000, NTT Communications Corporation, or NTT
Communications, through NTT Communications Capital (UK) Ltd., became PLDT&#146;s
strategic partner with approximately 15% economic and voting interest in the
issued common stock of PLDT.  Simultaneous with NTT Communications&#146; investment
in PLDT, we acquired 100% of Smart Communications, Inc., or Smart.  On March 14,
2006, NTT DoCoMo, Inc., or DoCoMo, acquired from NTT Communications 7% of
PLDT&#146;s outstanding common shares held by NTT Communications; NTT Communications
retained a 7% equity shareholding.</p>

<p align=left style='margin-left:.25in;text-align:left;page-break-after:
auto;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
common shares of PLDT are listed and traded on the Philippine Stock Exchange,
or PSE, and prior to October 19, 1994, were listed and traded on the American
Stock Exchange and the Archipelago Exchange (then the Pacific Exchange) in the United States.  On October 19, 1994, an American Depositary Receipt, or ADR, facility was
established, pursuant to which Citibank N.A., as the depositary, issued ADRs
evidencing American Depositary Shares, or ADSs, with each ADS representing one
PLDT common share with a par value of Php5 per share.  JP Morgan Chase Bank was
appointed as successor depositary for PLDT&#146;s ADR facility effective February 10, 2003.  The ADSs are listed on the New York Stock Exchange, or NYSE, and on the
NYSE Arca (formerly Archipelago Exchange) in the United States and are traded
on the NYSE.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
charter, like those of all other Philippine corporations, was initially limited
to a period of 50 years but has since been extended twice for 25 years each,
the last extension being for an additional </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">25-year
period through 2028.  Under its amended charter (Republic Act No. 7082), which
became effective on August 24, 1991, PLDT is authorized to provide virtually
every type of telecommunications service, both within the Philippines and
between the Philippines and other countries.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
operates under the jurisdiction of the Philippine National Telecommunications
Commission, or NTC, which jurisdiction extends, among other things, to
approving major services offered by PLDT and certain rates charged by PLDT.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Our
registered office address is Ramon Cojuangco Building, Makati Avenue, Makati City , Philippines.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK20">&nbsp;</a></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK12">&nbsp;</a></p>

</div>

<p style='margin-left:.25in;text-align:justify;text-indent:
- -.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Summary of
Significant Accounting Policies and Practices</b></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Basis of Preparation</b></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements have
been prepared under the historical cost convention as modified by the
revaluation of derivative financial instruments, available-for-sale financial
assets and investment properties that have been measured at fair values.  The
carrying values of recognized assets and liabilities that are hedged items in
fair value hedges, and are otherwise carried at cost, are adjusted to record
changes in the fair values attributable to the risks that are being hedged.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements have
been prepared in conformity with accounting principles generally accepted in
the Philippines as set forth in the Philippine Financial Reporting Standards.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements
include, in our opinion, all adjustments consisting only of normal recurring
adjustments, necessary to present fairly the results of operations for the interim
periods.  The results of operations for the six months ended June 30, 2006 are
not necessarily indicative of the results of operations that may be expected
for the full year.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements are
presented in Philippine pesos and all values are rounded to the nearest million
except when otherwise indicated.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Basis of Consolidation</b></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements
include the financial statements of PLDT and those of the following
subsidiaries (collectively, the PLDT Group), which were all incorporated in the
Philippines except for PLDT Global Corporation, or PLDT Global, (which was incorporated
in the British Virgin Islands) and Digital Paradise Thailand Ltd., or Digital
Paradise Thailand, a 51% owned subsidiary of ePLDT (which was incorporated in
Thailand).</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b>Name of Subsidiary</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:1.45pt;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><b>Principal Activity</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Percentage
 of Ownership</b></p>
 </td>
 </tr>

 <tr style='height:5.0pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:5.0pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Wireless </b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p align=right style='margin-top:1.0pt;margin-right:.1in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart and subsidiaries</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Cellular mobile
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ACeS Philippines
 Cellular Satellite <br>
 Corporation, or ACeS Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite phone
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Telesat, Inc., or Telesat</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite
 communications services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">94.4</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Mabuhay Satellite
 Corporation, or <br>
 Mabuhay Satellite</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite
 communications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">67.0</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:45.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:18.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:18.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:18.45pt'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:18.45pt'>
 <p align=right style='margin-right:45.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT Clark Telecom, Inc., or <br>
 Clark Telecom</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Subic Telecommunications Company,
 Inc., or Subic Telecom</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT Global and subsidiaries</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart-NTT Multimedia, Inc., or
 SNMI</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Data and network services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT-Maratel, Inc., or Maratel</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">97.5</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Bonifacio Communications
 Corporation, </p>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:17.6pt' style="margin-top:0;margin-bottom:0">or BCC</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications,
 infrastructure and related value-added services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Information
 and Communications Technology</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ePLDT and subsidiaries</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Information and communications
 infrastructure for internet-based services, e-commerce, call centers and
 IT-related services</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:45.05pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Subsidiaries
are consolidated from the date when control is transferred to the PLDT Group
and cease to be consolidated from the date when control is transferred out of
the PLDT Group.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We prepare our unaudited consolidated financial
statements using uniform accounting policies for like transactions and other
events with similar circumstances.  Intercompany balances and transactions,
including intercompany profits and unrealized profits and losses, are
eliminated.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Minority interests represent the equity interests in
Piltel, Wolfpac Mobile, Inc., or Wolfpac, Telesat, Mabuhay Satellite, Maratel,
BCC, Digital Paradise, Inc., or Digital Paradise, Digital Paradise Thailand, netGames, Inc., or netGames, Infocom Technologies, Inc., or Infocom, and Airborne
Access Corporation, or Airborne Access, not held by the PLDT Group.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>ePLDT&#146;s
Acquisition of Level Up!, Inc. or Level Up!</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On February 16, 2006, ePLDT acquired a 60% equity
interest in Level Up!, a leading publisher of online games in the Philippines with about an 80% share of the online gaming market.  The acquisition of Level
Up!, together with netGames, ePLDT&#146;s online gaming subsidiary, will strengthen
the position of ePLDT as the dominant online gaming company in the country.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Smart&#146;s 20% Acquisition of </i></b><b><i>Wolfpac</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On May 8, 2006, Smart signed a share purchase
agreement to acquire the remaining 20% equity interest in Wolfpac, a company
engaged in the business of consumer mobile applications software development
and content development.  Smart acquired an 80% equity interest in Wolfpac in
October 2003.  The remaining 20% equity interest in Wolfpac was paid in July
2006.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>ePLDT&#146;s Acquisition of SPi Technologies, Inc., or SPi</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On July 11, 2006, ePLDT completed the acquisition of
100% of SPi and its direct and indirect Philippine and offshore subsidiaries for
a total consideration of US$135.34 million from SPi&#146;s sole shareholder, SPi Tech
L.P., or SPi Tech.  The acquisition of SPi, combined with ePLDT Ventus, creates
the largest full service business process
outsourcing in the Philippines.  As part
of the transaction, ePLDT also acquired a US$7 million debt owed by SPi to SPi
Tech at face value.  In addition, ePLDT advanced US$16.43 million to SPi in
order for SPi to fully pay its debt owed to DBS Bank Singapore.  ePLDT intends
to have this debt refinanced by SPi in due course.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investments
in Associates</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Investments in associates in which we exercise significant influence and
which are neither a subsidiary nor a joint venture of the PLDT Group are
accounted for under the equity method of accounting.  Under the equity method,
our investments in associates are carried in the consolidated balance sheets at
cost plus post-acquisition changes in our share in net assets of the
associates.  After application of the equity method, we determine whether it is
necessary to recognize any additional impairment loss with respect to our net
investment in the associate.  The consolidated statements of income reflect our
shares of the results of operations of the associate.  Where there has been a
change recognized directly in the equity of the associate, we recognize our
share in any such change and disclose this, when applicable, in our
consolidated statement of equity.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Our
reporting dates and that of our associates are identical and our associates&#146;
accounting policies conform to those we use for like transactions and events in
similar circumstances.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Foreign Currency Translation</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The functional and presentation currency of the PLDT
Group (except for Mabuhay Satellite and PLDT Global) is the Philippine peso.
Transactions in foreign currencies are initially recorded in the functional
currency rate ruling at the date of the transaction.  Monetary assets and
liabilities denominated in foreign currencies are translated at the functional
currency rate of exchange ruling at the balance sheet date.  All differences
are taken to the consolidated statements of income except for foreign exchange
losses that qualified as capitalizable borrowing costs during the construction
period.  For income tax purposes,
exchange gains or losses are treated as taxable income or deductible expenses
in the period such are realized.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
functional currency of Mabuhay Satellite and PLDT Global is the U.S. dollar.
As at the reporting date, the assets and liabilities of these subsidiaries are
translated into the presentation currency of the PLDT Group at the rate of
exchange prevailing at the balance sheet date and, its income and expenses are
translated at the weighted average exchange rate for the period.  The exchange
differences arising on retranslation are taken directly to a separate component
of equity as cumulative translation adjustments.  On disposal of these subsidiaries,
the deferred cumulative amount of translation adjustments recognized in equity
relating to subsidiaries shall be recognized in the consolidated statement of
income. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Property,
Plant and Equipment</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Property,
plant and equipment, except for land, are stated at cost less accumulated
depreciation and amortization and any impairment in value.  Land is stated at
cost less any impairment in value.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The initial cost
of property, plant and equipment comprises its purchase price and any costs
directly attributable in bringing the asset to its working condition and
location for its intended use.  Expenditures incurred after the assets have
been put into operation, such as repairs and maintenance and overhaul costs,
are normally charged to income in the period the costs are incurred.  In situations where it can
be clearly demonstrated that the expenditures have resulted in an increase in
the future economic benefits expected to be obtained from the use of an item of
property, plant and equipment beyond its originally assessed standard of
performance, the expenditures are capitalized as additional costs of property,
plant and equipment.  Cost also includes asset retirement obligation, interest
on borrowed funds used during the construction period and qualified borrowing
costs from foreign exchange losses related to foreign currency-denominated
liabilities used to acquire such qualifying assets.  When assets are sold or
retired, their costs and accumulated depreciation, amortization and impairment
losses, if any, are eliminated from the accounts and any gain or loss resulting
from their disposal is included in the consolidated statement of income of such
period.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization are calculated on a
straight-line basis over the estimated useful lives of the assets.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
useful lives and depreciation and amortization method are reviewed periodically
to ensure that the periods and method of depreciation and amortization are
consistent with the expected pattern of economic benefits from items of
property, plant and equipment.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Property
under construction is stated at cost.  This includes cost of construction,
plant and equipment and other direct costs.  Property under construction is not
depreciated until such time that the relevant assets are completed and put into
operational use.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Borrowing Costs</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Borrowing costs are capitalized if they are directly
attributable to the acquisition, construction or production of a qualifying
asset.  Capitalization of borrowing costs commences when the activities for
intended use are in progress and expenditures and borrowing costs are being
incurred.  Borrowing costs are capitalized until the assets are ready for their
intended use.  If the resulting carrying amount of the asset exceeds
its recoverable amount, an impairment loss is recognized.  Borrowing costs
include interest charges and other costs incurred in connection with the
borrowing of funds, as well as exchange differences arising from foreign
currency borrowings used to finance these projects to the extent that they are
regarded as an adjustment to interest cost.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">All
other borrowing costs are expensed as incurred.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Borrowing
costs are treated as deductible expenses for income tax reporting purposes in
the period they are incurred or realized.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Asset Retirement Obligations</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The net
present value of legal and constructive obligations associated with the
retirement of an item of property, plant and equipment that resulted from the
acquisition, construction or development and the normal operation of property,
plant and equipment is recognized in the period in which it is incurred.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investment
Properties</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Initially,
investment properties are measured at cost including transaction costs.  The
carrying amount includes the cost of replacing part of an existing investment
property at the time that cost is incurred if the recognition criteria are met;
and excludes the costs of day to day servicing of an investment property.
Subsequent to initial recognition, investment properties are stated at fair
value, which reflects market conditions at the balance sheet date.  Gains or
losses arising from changes in the fair values of investment properties are
included in the consolidated statement of income in the period in which they
arise.  </p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Investment
properties are derecognized when they have either been disposed of or when the
investment property is permanently withdrawn from use and no future benefit is
expected from its disposal.  Any gain and loss on the retirement or disposal of
an investment property is recognized in the consolidated statement of income in
the period of retirement or disposal.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Goodwill</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Goodwill
is initially measured at the excess of the acquisition cost over the fair value
of identifiable assets, liabilities and contingent liabilities.  Following
initial recognition, goodwill is measured at cost less any accumulated
impairment loss.  Goodwill is no longer amortized but reviewed for impairment,
annually or more frequently if events or changes in circumstances indicate that
the carrying value may be impaired.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">As at acquisition date, any goodwill acquired is allocated to each of the
cash-generating units expected to benefit from the combination&#146;s synergies.
Impairment is determined by assessing the recoverable amount of the
cash-generating unit, to which the goodwill relates.  Where the recoverable
amount of the cash-generating unit is less than the carrying amount, an
impairment loss is recognized.  Where goodwill forms part of a cash-generating
unit and part of the operation within that unit is disposed of, the goodwill
associated with the operation disposed of is included in the carrying amount of
the operation when determining the gain or loss on disposal of the operation.
Goodwill disposed of in such circumstance is measured on the basis of the
relative values of the operation disposed of and the portion of the
cash-generating unit retained.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Intangible
Assets </i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Intangible
assets acquired separately are measured on initial recognition.  The cost of
intangible assets acquired from business combinations is initially recognized
at fair value as at the date of acquisition.  Following initial recognition,
intangible assets are carried at cost less any accumulated amortization and any
accumulated impairment loss.  The useful lives of intangible assets are
assessed at the individual asset level as having either a finite or indefinite
life.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Intangible
assets with finite lives are amortized over the useful economic life using the
straight-line method and assessed for impairment whenever there is an
indication that the intangible assets may be impaired.  At a minimum, the
amortization period and the amortization method for an intangible asset with a
finite useful life is reviewed at each financial period-end.  Changes in the
expected useful life or the expected pattern of consumption of future economic
benefits embodied in the asset are accounted for by changing the amortization
period, as appropriate, and treated as changes in accounting estimates.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Intangible
assets with indefinite useful lives are tested for impairment annually either
individually or at the cash-generating unit level.  Such intangible assets are
not amortized.  The useful life of an intangible asset with an indefinite life
is reviewed annually to determine whether indefinite life assessment continues
to be supportable.  If not, the change in the useful life assessment from
indefinite to finite is made on a prospective basis.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Gains
or losses arising from derecognition of an intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of the
asset and are recognized in the consolidated statement of income when the asset
is derecognized.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Intangible assets created within the business are not
capitalized and expenditure is charged against operations in the period in
which the expenditure is incurred.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Asset
Impairment</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Property,
plant and equipment, investments, goodwill and other long-lived assets are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable.  Whenever the
carrying amount of an asset exceeds its recoverable amount, an impairment loss
is recognized in the consolidated statements of income.  The recoverable amount
is the higher of an asset&#146;s net selling price or value in use.  The net selling
price is the amount obtainable from the sale of an asset in an arm&#146;s-length
transaction while value in use is the present value of estimated future cash
flows expected to arise from the continuing use of an asset or from its
disposal at the end of its useful life.  Recoverable amounts are estimated for
individual assets or, if these are not possible, for the cash-generating unit
to which the asset belongs.  Reversal of impairment losses recognized in prior periods
is recorded as income when there is an indication that the impairment losses
recognized for the asset no longer exist or have decreased.  However, the
increased carrying amount of an asset due to a reversal of an impairment loss
is recognized to the extent it does not exceed the carrying amount that would
have been determined had the impairment loss not been recognized for that asset
in prior periods.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Research
and Development Costs</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Research
and development costs are expensed as incurred.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Cash and Cash Equivalents</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Cash
includes cash on hand and in banks.  Cash equivalents are short-term, highly
liquid investments that are readily convertible to known amounts of cash with
original maturities of three months or less from the date of acquisition and
that are subject to an insignificant risk of change in value.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Trade
and Other Receivables</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0">Trade and other
receivables are stated at face value, net of allowance for doubtful accounts.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Allowance for Doubtful Accounts</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Allowance
for doubtful accounts is maintained at a level considered adequate to provide
for uncollectible receivables.  The level of allowance is based on historical
collections, write-off experience, current economic trends, changes in our
customer payment terms and other factors that may affect our ability to collect
payments.  An evaluation of the receivables, designed to identify potential
charges to the allowance, is performed on a continuous basis during the period.</p>

<p align=right style='margin-left:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Subscribers</i>.
Full allowance is provided for receivables from permanently disconnected
subscribers.  Permanent disconnections are made after a series of collection
steps following non-payment by subscribers.  Such permanent disconnections
generally occur within 105 days from due date.  Partial allowance is provided
for active subscribers based on the historical loss experience and aging
profile of the receivable.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Traffic
settlement receivables - net</i>.  Full
allowance is provided for carrier accounts which are over 360 days past due and
after a review of the status of settlement with other carriers.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Inventories and Supplies</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inventories and supplies which include, among other
things, cellular phone units, materials, spare parts, terminal units and
accessories, are valued at the lower of cost and net realizable value.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost is determined using the moving average method.
Net realizable value is the current replacement cost.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Interest-bearing Financial Liabilities</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">All
loans and borrowings are initially recognized at the fair value of the
consideration received less directly attributable transaction costs.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortized cost using the effective
interest method.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Gains
and losses are recognized in the statements of income when the liabilities are
derecognized as well as through the amortization process.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Financial
Assets and Liabilities</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">We
recognize a financial asset or a financial liability in our consolidated
balance sheets when we become a party to the contractual provisions governing
such financial asset or financial liability and derecognize a financial asset
when and only when our contractual rights to the cash flows underlying such
financial asset have already expired which is normally the case when the
instrument is sold, or all the cash flows attributable to such financial asset
are passed through to an independent third party.  A financial liability (or a
part of a financial liability) is derecognized when the obligation is
extinguished.  In the case of a regular way purchase or sale of financial
assets, recognition and derecognition, as applicable, are done using settlement
date accounting.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Financial
assets or financial liabilities are recognized initially at fair value.
Transaction costs are included in the initial measurement of all financial
assets and liabilities, except for financial instruments measured at fair value
through profit and loss.  Fair value is determined by reference to the
transaction price or other market prices.  If such market prices are not reliably
determinable, the fair value of the consideration is estimated as the sum of
all future cash payments or receipts, discounted using the prevailing market
rates of interest for similar instruments with similar maturities.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">After
initial recognition, the following financial assets and liabilities are
measured at amortized cost using the effective interest rate method:  (a) loans
and receivables; (b) held-to-maturity investments; and (c) financial
liabilities other than liabilities measured at fair value through profit and
loss.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Investments
in unquoted equity securities and derivatives linked thereon are measured at
cost.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Amortizations
of discounts and premiums are taken directly to net profit or loss for the
period.  Changes in the fair value of financial assets and liabilities measured
at fair value of (a) all derivatives (except for those eligible for hedge
accounting); (b) other items intended to be actively traded; and (c) any item
designated as held &#147;at fair value through profit and loss&#148; at origination, are
taken directly to net profit or loss for the period.  Changes in the fair value
of available-for-sale securities are recognized in equity, except for the
foreign exchange fluctuations on available-for-sale debt securities and the
interest component which is taken directly to net profit or loss for the period
based on the asset&#146;s effective yield.  Impairment determined for
available-for-sale financial assets are also recognized in net profit or loss
for the period.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financial assets and liabilities include financial
instruments which may be a primary instrument,
such as receivables, payables and equity securities, or a derivative
instrument, such as financial options, futures and forwards, interest rate
swaps and currency swaps.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Financial
instruments are classified as a financial liability or as equity, in accordance
with the substance of the contractual arrangement underlying such financial
instruments.  Financial instruments that contain both liability and equity
elements are classified separately as financial assets, financial liabilities
or equity instruments.  Interests, dividends, gains and losses relating to a
financial instrument or a component that is a financial liability, are reported
as expense or income.  Distributions to holders of financial instruments
classified as equity are charged directly to equity, net of any related income
tax benefits.  Financial instruments are offset when we have a legally
enforceable right to offset and we intend to settle either on a net basis or to
realize the asset and settle the liability simultaneously. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We use
derivative financial instruments such as long-term currency swaps, foreign
currency options, interest rate swaps and forward currency contracts to hedge
our risks associated with foreign currency and interest rate fluctuations.
Such derivative financial instruments are stated at fair value.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
criteria for a derivative instrument to be classified as a hedge include: (1) that
the hedge transaction is expected to be highly effective in achieving offsetting
changes in fair value or cash flows attributable to the hedged risk, (2) that the
effectiveness of the hedge can be reliably measured, (3) that there is adequate
documentation of the hedging relationships at the inception of the hedge, and
(4) for cash flow hedges, that the forecast transaction that is the subject of
the hedge must be highly probable and must present an exposure to variations in
cash flows that could ultimately affect profit or loss.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">For
purposes of hedge accounting, hedges are classified as either fair value hedges
where they hedge the exposure to changes in the fair value of a recognized
asset or liability and firm commitment; or cash flow hedges where they hedge
exposure to variability in cash flows that is either attributable to a
particular risk associated with a recognized asset or liability or a forecasted
transaction.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
relation to fair value hedges which meet the conditions for special hedge
accounting, any gain or loss from re-measuring the hedging instrument at fair
value is recognized immediately in the consolidated statements of income.  Any
gain or loss on the hedged item attributable to the hedged risk is adjusted
against the carrying amount of the hedged item and recognized in the
consolidated statements of income.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
relation to cash flow hedges, the portion of the gain or loss on the hedging
instrument that is determined to be an effective hedge is recognized directly
in equity and the ineffective portion is recognized in net profit or loss.  The
gains or losses that are accumulated in equity are transferred to the
consolidated statement of income in the same period in which the hedged item
affects the net profit or loss.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">For
derivatives that do not qualify for hedge accounting, any gains or losses
arising from changes in fair value are taken directly to net profit or loss for
the period.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Hedge
accounting is discontinued when the hedging instrument expires or is sold,
terminated or exercised, or no longer qualifies for hedge accounting.  At that
point in time, any cumulative gains or losses on the hedging instrument
recognized in equity are kept in equity until the forecast transaction occurs.
If the forecast transaction is no longer expected to occur, any net cumulative
gains or losses previously recognized in equity are transferred to net profit
or loss for the period.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Provisions</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We
recognize provisions when we have present obligations, legal or constructive,
as a result of past events, if it is probable that an outflow of resources
embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation.  If the effect
of the time value of money is material, provisions are determined by
discounting the expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money and, where appropriate,
the risks specific to the liability.  Where discounting is used, the increase
in the provision due to the passage of time is recognized as additional
provisions.  Where we expect some or all of a provision to be reimbursed, the
reimbursement is recognized.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Retirement
Benefits</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We have
funded, retirement plans, administered by our respective Fund&#146;s Trustees,
covering permanent employees.  Retirement costs are actuarially determined
using the projected unit credit of accrued benefit valuation method.  This
method reflects services rendered by employees to the date of valuation and
incorporates assumptions concerning employees&#146; projected salaries.  Retirement
costs include current service cost plus amortization of past service cost,
experience adjustments and changes in actuarial assumptions.  Past service cost
is recognized as an expense on a straight-line basis over the average period
until the benefits become vested.  Actuarial gains and losses are recognized as
income or expense when the net cumulative unrecognized actuarial gains and
losses at the end of the previous reporting period exceeded 10% of the higher
of the defined benefit obligation and the fair value of plan assets at that
date.  These gains and losses are recognized over the expected average
remaining working lives of the employees participating in the plan.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Share-Based Payment Transactions</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Certain of our employees (including directors) receive
remuneration in the form of share-based payment transactions, whereby employees
render services in exchange for shares or rights over shares (&#147;equity-settled
transactions&#148;).</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Equity-settled
transactions</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
cost of equity-settled transactions with employees is measured by reference to
the fair value of the stock options at the date at which they are granted.
Fair value is determined using an option-pricing model, further details of
which are given in <i>Note 21 &#150; Employee Benefits</i>.  In valuing
equity-settled transactions, no account is taken of any performance conditions,
other than conditions linked to the price of the shares of PLDT (&#147;market
conditions&#148;).</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The cost of equity-settled transactions is recognized,
together with a corresponding increase in equity, over the period in which the
performance conditions are fulfilled, ending on the date on which the relevant
employees become fully entitled to the award (&#147;vesting date&#148;).  The cumulative
expense recognized for equity-settled transactions at each reporting date until
the vesting date reflects the extent to which the vesting period has expired
and the number of awards that will ultimately vest, in the opinion of PLDT&#146;s
Board of Directors, at that date, based on the best available estimate.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">No expense
is recognized for awards that do not ultimately vest, except for awards where
vesting is conditional upon a market condition, which are treated as vesting
irrespective of whether or not the market condition is satisfied, provided that
all other performance conditions are satisfied.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Where the terms of an equity-settled award are
modified, an expense, at a minimum, is recognized as if the terms had not been
modified.  An expense is recognized for any increase in the value of the
transactions as a result of the modification, as measured at the date of
modification.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Where an
equity-settled award is cancelled, it is treated as if it had vested on the
date of cancellation, and any expense not yet recognized for the award is
recognized immediately.  However, if a new award is substituted for the
cancelled award, and designated as a replacement award on the date that it is
granted, the cancelled and new awards are treated as if they were modifications
of the original award, as described in the previous paragraph.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The dilutive effect of outstanding options is
reflected as additional share dilution in the computation of earnings per
share, see <i>Note 7 &#150; Earnings Per Common Share</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Cash-settled
transactions</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
Long-Term Incentive Plan, or LTIP, grants share appreciation rights, or SARs,
to our eligible key executives and advisors.  Under the LTIP, we recognize the
services we receive from the eligible key executives and advisors, and our
liability to pay for those services, as the eligible key executives and advisors
render services during the vesting period.  We measure our liability, initially
and at each reporting date until settled, at the fair value of the SARs, by
applying an option valuation model, taking into account the terms and
conditions on which the SARs were granted, and the extent to which the eligible
key executives and advisors have rendered service to date.  We recognize any
changes in fair value at each reporting date until settled, in the results of
operations for the period.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Leases</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Lease obligations having provisions for bargain
purchase options, ownership transfer at the end of the lease term, or the
present value of minimum lease payments, approximate the fair market value of
the property, are capitalized.  Any initial direct costs of the lessee are
added to the amount capitalized.  The related obligations are recognized as
liabilities.  Finance lease payments are apportioned between the finance
charges and reduction of the lease liability so as to achieve a constant rate
of interest on the remaining balance of the liability.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">A finance
lease gives rise to a depreciation expense for the asset as well as a borrowing
cost for each period.  Finance charges are charged directly to current
operations in the period such are incurred.  The depreciation policy for leased
assets is consistent with that for depreciable assets that are owned.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Leases where the lessor retains substantially all the
risks and benefits of ownership of the asset are classified as operating
leases.  Operating lease payments are recognized as an expense in the
consolidated statements of income on a straight-line basis over the lease
term.  For income tax reporting purposes, expenses that should have been
incurred under a lease agreement are considered as deductible expenses.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Revenue Recognition</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Revenues
for services are stated at amounts invoiced to customers, excluding value-added
tax, or VAT.  We provide wireless communication services, fixed line
communication services, and information and communications technology
services.  We provide such services to mobile, business, residential and
payphone customers.  Revenues represent the value of fixed consideration that
have been received or are receivable.  Revenues are recognized when there is
evidence of an arrangement, collectibility is reasonably assured and the
delivery of the product or service has occurred.  In certain circumstances,
revenue is split into separately identifiable components and recognized when
the related components are delivered in order to reflect the substance of the
transactions.  The value of components is determined using verifiable objective
evidence.  We do not provide our customers with the right to a refund.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Service
revenues</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0"><i>Subscriptions</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">We
provide telephone and data communication services under prepaid and postpaid
payment arrangements.  Revenues, including fees for installation and
activation, are accrued upon subscription.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Air time, traffic and value-added services</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid service revenues collected in advance are
deferred and recognized based on the earlier of actual usage or upon expiration
of the usage period.  Interconnection revenues for call termination, call
transit, and network usage are recognized in the period the traffic occurs.
Revenues related to local, long distance, network-to-network, roaming and
international call connection services are recognized when the call is placed
or connection is provided, net of amounts payable to other telecommunication
carriers for terminating calls in their territories.  Revenues related to
products and value-added services are recognized upon delivery of the product
or service.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Directory services</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues related to published directory services are
recognized on a pro rata basis over the period in which the publication
expires, which is generally 12 months.  Telephone-based directory service
revenues are recognized when the service is provided.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0"><i>Incentives</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">We
record insignificant commission expense based on the number of new subscriber
connections initiated by certain dealers.  All other cash incentives provided
to dealers and customers are recorded as a reduction of revenue.  Product-based
incentives provided to dealers and customers as part of a transaction are
accounted for as multiple element arrangements and recognized when earned.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Non-service
revenues</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0"><i>Handset
and equipment sales</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Sales
of cellular handsets and communication equipment are recognized upon delivery
to the customer.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.3in;text-indent:.2in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Others</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest income is recognized as it accrues on a time
proportion basis taking into account the principal amount outstanding and the
effective interest rate.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Income
Taxes</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.3in;text-indent:.2in' style="margin-top:0;margin-bottom:0"><i>Current tax</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Current
tax assets and liabilities for the current and prior periods are measured at
the amount expected to be recovered from or paid to the tax authority.  The tax
rates and tax laws used to compute the amount are those that are enacted or
substantively enacted as at the balance sheet date.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.3in;text-indent:.2in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Deferred tax</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deferred income tax is provided using the balance
sheet liability method on all temporary differences at the balance sheet date
between the tax bases of assets and liabilities and their carrying amounts for
financial reporting purposes.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Deferred
income tax liabilities are recognized for all taxable temporary differences.
Deferred income tax assets are recognized for all deductible temporary differences,
carryforward of unused tax credits from excess minimum corporate income tax, or
MCIT, and unused tax losses, to the extent that it is probable that taxable
profit will be available against which the deductible temporary differences and
carryforward of unused tax credits and unused tax losses can be utilized.
Deferred income tax, however, is not recognized when it arises from the initial
recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Deferred
tax liabilities are not provided on non-taxable temporary differences
associated with investments in domestic subsidiaries and associates.  With
respect to investments in other subsidiaries and associates, deferred tax
liabilities are recognized except when the timing of the reversal of the
temporary difference can be controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
carrying amount of deferred income tax assets is reviewed at each balance sheet
date and reduced to the extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the deferred income
tax asset to be utilized.  Unrecognized deferred income tax assets are
reassessed at each balance sheet date and are recognized to the extent that it
has become probable that future taxable profit will allow the deferred tax
asset to be recovered.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Deferred
income tax assets and liabilities are measured at the tax rates that are
expected to apply in the period when the asset is realized or the liability is
settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted as at the balance sheet date.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Income tax
relating to items recognized directly in equity is included in the related
equity account and not in the consolidated statements of income.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Earnings Per Common Share, or EPS</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic EPS is calculated by dividing the net income for
the period attributable to common shareholders (net income adjusted for
dividends on all series of preferred shares except for dividends on preferred
stock subject to mandatory redemption) by the weighted average number of common
shares outstanding during the period, after giving retroactive effect to any
stock dividend declarations.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Diluted
EPS is calculated in the same manner assuming that, at the beginning of the period
or at the time of issuance during the period, all outstanding options are
exercised and convertible preferred shares are converted to common shares and
appropriate adjustments to net income are effected for the related expenses and
income on preferred shares.  Outstanding stock options will have a dilutive
effect under the treasury stock method only when the average market price of
the underlying common share during the period exceeds the exercise price of the
option.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Where
the effect of the assumed conversion of the preferred shares and the exercise
of all outstanding options have an anti-dilutive effect, basic and diluted EPS
are stated at the same amount.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">If
the required dividends to be declared on each series of convertible preferred
shares divided by the number of equivalent common shares, assuming such
convertible preferred shares are converted to common shares, would decrease the
basic EPS, then such convertible preferred shares would be deemed dilutive.  As
such, the diluted EPS will be calculated by dividing net income attributable to
common shareholders (net income, adding back any dividends and/or other charges
recognized in the period related to the dilutive convertible preferred shares
classified as liability, less dividends on non-dilutive preferred shares except
for dividends on preferred stock subject to mandatory redemption) by the
weighted average common shares including the common share equivalent arising
from the conversion of the dilutive convertible preferred shares.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>3.   Management&#146;s
Use of Estimates and Judgments</b></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Our unaudited consolidated financial statements prepared in Philippine
GAAP require management to make estimates and assumptions that affect amounts
reported in our unaudited consolidated financial statements and related notes.
In preparing our unaudited consolidated financial statements, we have made our
best estimates and judgments of certain amounts, giving due consideration to
materiality.  We believe the following represents a summary of these
significant estimates and judgments and related impacts and associated risks to
our unaudited consolidated financial statements.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Estimating useful lives of property, plant and
equipment</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We
estimate the useful lives of our property, plant and equipment based on the
periods over which our assets are expected to be available for use.  The
estimated useful lives of our property, plant and equipment are reviewed at
least annually and are updated if expectations differ from previous estimates
due to physical wear and tear, technical or commercial obsolescence and legal
or other limits on the use of our assets.  In addition, our estimation of the
useful lives of our property, plant and equipment is based on our collective
assessment of industry practice, internal technical evaluation and experience
with similar assets.  It is possible, however, that future results of operations
could be materially affected by changes in our estimates brought about by
changes in the factors mentioned above.  The amounts and timing of recorded
expenses for any period would be affected by changes in these factors and
circumstances.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">A
reduction in the estimated useful lives of our property, plant and equipment
would increase our recorded operating expenses and decrease our noncurrent
assets.  Total carrying values of property, plant and equipment amounted to Php173,832
million and Php176,974 million as at June 30, 2006 and December 31, 2005,
respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Goodwill and intangible assets</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Purchase
accounting requires extensive use of accounting estimates and judgments to
allocate the purchase price to the fair market values of the acquiree&#146;s identifiable
assets and liabilities at the acquisition date.  It also requires the acquiree
to recognize goodwill.  Our business acquisitions have resulted in goodwill and
intangible assets, which are subject to a periodic impairment test and
amortization, respectively.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Total carrying
values of goodwill and intangible assets as at June 30, 2006 and December 31,
2005 amounted to Php3,312 million and Php3,049 million, respectively.  There
are no impairment losses recognized for the six months ended June 30, 2006 and
2005.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Asset
impairment</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Philippine GAAP requires that an impairment review be performed when
certain impairment indicators are present.  In the case of goodwill, at a
minimum, such asset is subject to a yearly impairment test and whenever there
is an indication that such asset may be impaired.  This requires an estimation
of the value in use of the cash-generating units to which the goodwill is
allocated.  Estimating the value in use requires us to make an estimate of the
expected future cash flows from the cash generating unit and to choose a
suitable discount rate in order to calculate the present value of those cash
flows.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Determining the fair values of property, plant and equipment, investments
and intangible assets, which requires the determination of future cash flows
expected to be generated from the continued use and ultimate disposition of
such assets, requires us to make estimates and assumptions that can materially
affect our unaudited consolidated financial statements.  Future events could cause
us to conclude that property, plant and equipment, investments and intangible
assets associated with an acquired business are impaired.  Any resulting
impairment loss could have a material adverse impact on our financial condition
and results of operations.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">The preparation of estimated future cash flows involves significant
judgments and estimations.  While we believe that our assumptions are
appropriate and reasonable, significant changes in our assumptions may
materially affect our assessment of recoverable values and may lead to future
additional impairment charges under Philippine GAAP.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Investment properties</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We have
adopted the fair value approach in determining the carrying value of our
investment properties.  We have opted to rely on independent appraisers to
determine the fair values of our investment properties, and such fair values were
determined based on recent prices of similar properties, with adjustments to reflect any changes in economic conditions since
the date of those transactions.  The amounts and timing of recorded changes in
fair value for any period would differ if we made different judgments and
estimates or utilized a different basis for determining fair value.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Total carrying
values of investment properties as at June 30, 2006 and December 31, 2005 amounted
to Php691 million and Php701 million, respectively.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Deferred tax assets</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We review the
carrying amounts of deferred tax assets at each balance sheet date and reduce these
to the extent that they are no longer probable that sufficient taxable profit
will be available to allow all or part of the deferred tax assets to be
utilized.  However, there is no assurance that we will generate sufficient
taxable profit to allow all or part of our deferred tax assets to be utilized.
</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Total unrecognized deferred tax assets as at June
30, 2006 amounted to Php2,896 million.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Financial
assets and liabilities</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Philippine
GAAP requires that we carry certain of our financial assets and liabilities at
fair value, which requires extensive use of accounting estimates and judgments.
In addition, certain liabilities acquired through debt exchange and
restructuring are required to be carried at fair value at the time of the debt
exchange and restructuring, see <i>Note</i> <i>24 &#150; Financial Assets and Liabilities</i>.
While significant components of fair value measurement were determined using
verifiable objective evidence (i.e., foreign exchange rates, interest rates,
volatility rates), the amount of changes in fair value would differ if we
utilized a different valuation methodology.  Any change in fair value of these
financial assets and liabilities would directly affect our profit and loss and
equity.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Total fair
value of financial assets and liabilities as at June 30, 2006 amounted to Php38,535
million and Php127,072 million, respectively, while the total fair value of
financial assets and liabilities as at December 31, 2005 amounted to Php43,063
million and Php148,848 million, respectively.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Estimating
allowance for doubtful accounts</i></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">We estimate the allowance for doubtful accounts related to our trade
receivables based on two methods.  The amounts calculated using each of these
methods are combined to determine the total amount we reserve.  First, we
evaluate specific accounts where we have information that certain customers are
unable to meet their financial obligations.  In these cases, we use judgment,
based on the best available facts and circumstances, including but not limited
to, the length of our relationship with the customer and the customer&#146;s current
credit status based on third party credit reports and known market factors, to
record specific reserves for customers against amounts due to reduce our
receivables to amounts that we expect to collect.  These specific reserves are
re-evaluated and adjusted as additional information received affects the
amounts estimated.  Second, a general provision is established as a certain
percentage of operating revenues based on the aging profile of receivables.
This percentage is based on a collective assessment of historical collection,
write-off experience, current economic trends, changes in our customer payment
terms and other factors that may affect our ability to collect payments.  Full
allowance is provided for receivables from permanently disconnected subscribers
and carriers.  Such permanent disconnections generally occur within 105 days
from due date.  Partial allowance is provided for active subscribers and
carriers based on the age status of receivables.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
amounts and timing of recorded expenses for any period would differ if we made
different judgments or utilized different estimates.  An increase in our
allowance for doubtful accounts would increase our recorded operating expenses
and decrease our current assets.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Provision
for doubtful accounts amounted to Php435 million and Php1,526 million for the six
months ended June 30, 2006 and 2005, respectively.  Trade and other
receivables, net of allowance for doubtful accounts, amounted to Php7,844
million and Php7,113 million as at June 30, 2006 and December 31, 2005,
respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Revenue recognition</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
revenue recognition policies require us to make use of estimates and
assumptions that may affect the reported amounts of our revenues and
receivables.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
agreements with domestic and foreign carriers for inbound and outbound traffic
subject to settlements require traffic reconciliations before actual settlement
is done, which may not be the actual volume of traffic as measured by us.
Initial recognition of revenues is based on our observed traffic adjusted by
our normal experience adjustments, which historically are not material to our unaudited
consolidated financial statements.  Differences between the amounts initially
recognized and actual settlements are taken up in the accounts upon reconciliation.
However, there is no assurance that such use of estimates will not result in material
adjustments in future periods.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Revenues
under a multiple element arrangement specifically applicable to our wireless
business were split into separately identifiable components and recognized when
the related components were delivered in order to reflect the substance of the
transaction.  The fair value of components was determined using verifiable
objective evidence.  Revenue for handset sales has been quantified and
identified separately using the residual value method from our cellular service
revenue.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Pension
and other retirement benefits</i></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">The determination of our obligation and cost for pension and other
retirement benefits is dependent on our selection of certain assumptions used
by actuaries in calculating such amounts.  Those assumptions are described in <i>Note
21 &#150; Employee Benefits</i> and include, among other things, discount rates,
expected returns on plan assets and rates of compensation increase.  In conformity
with Philippine GAAP, actual results that differ from our assumptions are recognized
as income or expense when the net cumulative unrecognized actuarial gains and
losses at the end of the previous reporting period exceed 10% of the higher of
the defined benefit obligation and the fair value of plan assets at that date.  While
we believe that our assumptions are reasonable and appropriate, significant
differences in our actual experience or significant changes in our assumptions
may materially affect our pension and other retirement obligations.  </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Unrecognized net actuarial gain as at June 30, 2006 amounted to Php162
million.  The accrued benefit cost as at June 30, 2006 and December 31, 2005
amounted to Php2,675 million and Php2,275 million, respectively.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Legal
Contingencies</i></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">We are currently involved in various legal proceedings.  Our estimate of
the probable costs for the resolution of these claims has been developed in
consultation with outside counsel handling our defense in these matters and is
based upon an analysis of potential results.  We currently do not believe these
proceedings will have a material adverse effect on our unaudited consolidated
financial statements.  It is possible, however, that future results of
operations could be materially affected by changes in our estimates or in the
effectiveness of our strategies relating to these proceedings, see <i>Note 23 &#150;
Provisions and Contingencies.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Outstanding
provisions to cover these contingencies amounted to Php4,536 million and Php4,374
million as at June 30, 2006 and December 31, 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4.   Segment Information</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Operating
segments are components of PLDT that engage in business activities from which
they may earn revenues and incur expenses (including revenues and expenses relating
to transactions with other components of PLDT), whose operating results are
regularly reviewed by the enterprise&#146;s chief operating decision maker to make
decisions about how resources are to be allocated to the segment and assess
their performances, and for which discrete financial information is available.
The accounting policies of the reportable segments are the same as those
described in <i>Note 2 &#150; Summary of Significant Accounting Policies and
Practices</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We have organized our business into three main
segments:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wireless &#151; wireless telecommunications services provided through our cellular
service providers namely, Smart and Piltel, Smart Broadband, Inc., or Smart
Broadband (formerly Meridian Telekoms, Inc., or Meridian), our wireless
broadband provider; Wolfpac, our wireless content operator, and satellite and
very small aperture terminal, or VSAT, operators, namely PLDT&#146;s subsidiaries
Mabuhay Satellite, ACeS Philippines and Telesat;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fixed Line &#151; fixed line telecommunications services are primarily provided through
PLDT.  We also provide fixed line services through PLDT&#146;s subsidiaries; Clark
Telecom, Subic Telecom, Maratel, Piltel, BCC and PLDT Global, which together
account for approximately 3% of our consolidated fixed lines service revenues; and</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Information and Communications
Technology &#151; information and communications infrastructure and
services for internet applications, internet protocol-based solutions and
multimedia content delivery provided by PLDT&#146;s subsidiary ePLDT; call center
services provided under one umbrella brand name <i>ePLDT Ventus</i>, including
Parlance Systems, Inc., or Parlance and Vocativ Systems, Inc., or Vocativ;
internet access and gaming services provided by ePLDT&#146;s subsidiaries Infocom,
Digital Paradise, Digital Paradise Thailand, netGames, Airborne Access and
Level Up!; and e-commerce and IT-related services provided by other investees
of ePLDT, as described in <i>Note 9 &#150; Investments in Associates</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
segment assets as at June 30, 2006 and December 31, 2005 and results of operations
of our reportable segments for the six months ended June 30, 2006 and 2005 are
as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Information and Communications Technology</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Inter-segment Transactions</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:2.7in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.05pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=6 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:2.9pt;margin-bottom:
 0in;margin-left:8.6pt;margin-bottom:.0001pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0"><i>As at and for the six months ended June 30, 2006
 (Unaudited)</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Income</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Service revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">38,591</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,053</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,812</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,816)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">60,640</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Non-service revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,188</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">172</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,383</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Equity
 share in net income of associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">   3</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Other income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">229</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(51)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 335</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Segment income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">39,912</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,318</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,011</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,880)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">62,361</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Result</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,254</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">296</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,625</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Provision for (benefit from) income tax</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,953</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(12)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,986</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Net income for the period</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,301</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 251</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  87</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,639</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Segment assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">88,555</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">186,314</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,228</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(54,385)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">226,712</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,661</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14,379</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,059</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">92,216</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">200,693</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,247</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(54,385)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">244,771</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Other segment information </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,016</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,849</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">520</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">12,385</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,195</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,038</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,485</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provisions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">284</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">485</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 770</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Interest on loans and related items - <br>
 net of capitalized interest</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">756</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,290</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,053</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">585</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">243</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 837</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.8pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p style='margin-top:0in;margin-right:2.9pt;margin-bottom:
 0in;margin-left:13.1pt;margin-bottom:.0001pt;text-indent:-13.1pt' style="margin-top:0;margin-bottom:0"><i>As at December 31, 2005 (Audited) and for
 the six months ended June 30, 2005 (Unaudited</i><i>)</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Income</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Service revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">36,483</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,235</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,328</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,503)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">59,543</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Non-service revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,291</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">215</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(84)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,422</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Equity
 share in net income of associates</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">   3</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Other income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">101</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(29)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 170</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Segment income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37,831</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,336</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,587</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,616)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">61,138</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Result</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Income before income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,526</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,440</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">69</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">22,035</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Provision for income tax</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,196</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,281</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,483</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Net income for the period</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">13,330</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,159</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  63</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,552</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Assets</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Segment assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">97,159</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">185,140</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,355</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(52,398)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">234,256</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,022</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">13,430</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,457</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">99,181</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">198,570</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,360</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(52,398)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">249,713</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Other segment
 information</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,577</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,129</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">306</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,012</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,970</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,704</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">187</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,861</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provisions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">437</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,550</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,987</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Interest on loans and related items - <br>
 net of capitalized interest</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">898</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,541</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,453</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">543</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">193</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 741</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5.   Income and Expenses</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited) </p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Sale of computers, cellular handsets and SIM-packs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,224</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,291</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Point-of-product sales</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>159</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">131</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,383</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,422</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Compensation and Benefits</i></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Salaries
 and benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,122</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,455</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Incentive
 plans (Note 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>933</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">610</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Pension (Note 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>499</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">384</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Manpower rightsizing program</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>62</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">43</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,616</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,492</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Financing
Costs</i></p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='height:7.6pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:31.45pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:31.45pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,355</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,656</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Accretion on
 financial liabilities - net (Notes 2, 17 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,823</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,509</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Hedge costs
 (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>746</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">557</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Foreign
 exchange loss (gains) - net (Notes 17 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>195</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,382)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Dividends
 on preferred stock subject to mandatory redemption (Note 17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>93</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=left style='margin:0in;margin-bottom:.0001pt;
 text-align:left;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Financing charges (Note 7)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>39</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">74</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Loss (gain) on derivative transactions - net (Notes 2 and
 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>23</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(778)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Capitalized
 interest (Notes 2 and 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(302)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(203)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(837)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(741)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,135</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">4,824</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>Cost of Sales</i></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Cost of computers, cellular
 handsets and SIM-packs sold</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,361</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,149</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Cost of
 satellite air time and terminal units (Notes 20 and 22)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>99</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">122</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,460</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,271</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>Provisions</i></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Doubtful
 accounts (Note 14)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>435</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,526</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Write-down of inventories to net realizable values
 (Note 15)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>186</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">325</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Onerous contracts and
 assessments (Notes 20, 22 and 23)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>149</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">136</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>770</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,987</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6.   Income Taxes</b></p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The net
components of deferred income tax recognized in the consolidated balance sheets
are as follows:</p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='height:13.9pt'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;punctuation-wrap:hanging;
 text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-bottom:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net assets</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,059</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15,457</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>39</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
components of net deferred tax assets and liabilities are as follows:</p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December
 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Net assets</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:4.3pt;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unrealized foreign exchange
 losses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,179</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6,885</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accumulated provision for
 doubtful accounts</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,089</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,085</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Net operating loss carryover, or
 NOLCO</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,001</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,926</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Asset impairment</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,124</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,127</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,413</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,524</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Pension and other employee
 benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,794</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,409</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative instruments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,485</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">464</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unamortized past service costs</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>956</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,032</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Provision for unrealized assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>852</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">769</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">MCIT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>526</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">526</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accumulated write-down of
 inventories to net realizable values</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>372</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">337</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Asset retirement obligation -
 net of capitalized asset</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>180</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Leases</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>107</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">153</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Executive stock option plan</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>75</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">104</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Excess of fair value over cost
 of investment properties</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(93)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(90)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Intangibles and fair value
 adjustments on assets acquired</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(442)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(483)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Capitalized taxes and duties </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(481)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(516)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Preferred stock subject to
 mandatory redemption</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(537)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,034)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Capitalized foreign exchange
 differential</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,802)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,721)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Gain on debt exchange and debt
 restructuring transactions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(2,157)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,601)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Undepreciated capitalized
 interest charges</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,649)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,664)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>67</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,059</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15,457</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.75in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:4.3pt;
 margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:right;
 text-indent:-.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.75in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:4.3pt;
 margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:right;
 text-indent:-.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 liabilities</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unearned
 revenues</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision
 for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unrealized foreign exchange
 gains</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(33)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(44)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(39)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(49)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Provision
for corporate income tax consists of:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:6.2pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:6.2pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:6.2pt'>
 <p align=center style='margin-left:40.3pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,616</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,003</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deferred</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,630)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">480</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,986</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,483</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
reconciliation between the provision for income tax at the applicable statutory
tax rates and the actual provision for corporate income tax is as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse;width:96.86% !msorm;
 border-collapse:collapse !msorm'>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt' style='page-break-inside:
 avoid !msorm;height:3.0pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:3.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:3.0pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Provision for corporate income
 tax at the applicable statutory tax rates</p>
 </td>
 <td   valign=bottom style=' background:white;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,518</b></p>
 </td>
 <td   valign=bottom style=' background:white;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7,051</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Tax effects of:</p>
 </td>
 <td   valign=bottom style=' background:white;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:white;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt' style='page-break-inside:
 avoid !msorm;height:6.75pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.75pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Non-deductible
 expenses </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>222</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">244</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt' style='page-break-inside:
 avoid !msorm;height:9.45pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Loss (income)
 subject to lower tax rate</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(164)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Income subject to final tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(303)</b></p>
 </td>
 <td   valign=bottom style=' background:white;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(228)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Income not
 subject to tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(685)</b></p>
 </td>
 <td   valign=bottom style=' background:white;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(61)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net movement
 in deferred income tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(2,768)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,359)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Actual provision for corporate income
 tax</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,986</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,483</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite and Subic Telecom are registered as Subic Bay Freeport Enterprises
while Clark Telecom is registered as a Clark Special Economic Zone Enterprise
under R.A. No. 7227, otherwise known as the Bases Conversion and Development
Act of 1992, or the Act.  As registrants, Mabuhay Satellite, Subic Telecom and
Clark Telecom are entitled to all the rights, privileges and benefits
established thereunder including tax and duty-free importation of capital
equipment and a special income tax rate of 5% of gross income, as defined in
the Act.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On
December 22, 2000, the Philippine Board of Investments, or BOI, approved
ePLDT&#146;s registration as a new information technology, or IT, service firm in
the field of services related to its internet data center on a pioneer status.
As such, ePLDT enjoys, among other incentives, a six-year income tax holiday,
or ITH, from January 2001.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Parlance
is registered with the BOI as a new IT export service firm in the field of
customer interaction center on a pioneer status.  Under this registration,
Parlance shall be entitled to certain tax incentives like ITH for six years
starting June 2002.  Parlance is required to comply with specific terms and
conditions stated in its BOI registration.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">iPlus
Intelligent Network, Inc., or iPlus, <a name="OLE_LINK41"></a><a
name="OLE_LINK26">is a wholly-owned subsidiary of ePLDT and </a>is registered
with the BOI as a new IT service firm in the field of application service
provider on a pioneer status.  Under such registration, iPlus is entitled to a
six-year ITH incentive from the actual start of commercial operations until January 1, 2009.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Vocativ is
registered with the Philippine Economic Zone Authority, or PEZA, as an Ecozone
Export Enterprise to develop and operate a call center business that serves
overseas clients by providing customer relationship management services.  As a
registered enterprise, Vocativ is entitled to certain tax and nontax incentives
which include, among other things, tax and duty-free importations, exemption
from local tax and ITH for four years from start of commercial operations.
After the ITH period, Vocativ is liable for a final tax, in lieu of all taxes
after the expiration of its incentives.  The final tax is computed at 5% of
gross income less allowable deductions as defined under R.A. No. 7916, &#147;The
Special Economic Zone Act of 1995,&#148; and shall be paid and remitted in
accordance with the amendments contained in R.A. No. 8748, as follows: (a) 3%
to the National Government; and <br>
(b) 2% which shall be directly remitted by the business establishments to the
treasurer&#146;s office of the municipality or city where the enterprise is located.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On December 5, 2005, Vocativ received approval from PEZA for the adjustment of the start of
commercial operations, effectively extending the ITH expiration to the end of
March 2006.  As at June 30, 2006, PEZA approved ITH extension for another year
which effectively extends ITH expiration in April 2007.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">mySecureSign,
Inc., or mSSI, is a wholly-owned subsidiary of ePLDT and is registered with the
BOI as a new IT service firm in the field of services related to public key
infrastructure on a pioneer status. Under such registration, mSSI enjoys, among
other incentives, a six-year ITH from August 1, 2001 or actual start of commercial operations, whichever comes first.  mSSI started commercial operations on January 1, 2002.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">ePLDT Ventus
is registered with the BOI as a new IT export service firm in the field of
customer interaction center on a pioneer status.  Under this registration, ePLDT
Ventus shall be entitled to certain tax incentives such as an ITH for six years
starting March 2005.  In relation to this, ePLDT Ventus is required to comply
with specific terms and conditions stated in the BOI registration.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK28">Digital </a>Paradise is registered
with the BOI as a new IT service firm in the field of community access on a
non-pioneer status.  Under the provisions of the registration, Digital Paradise&#146;s
sales generated from its own community access activity and franchise fees shall
be entitled to ITH for a period of four years beginning December 2002.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Level
Up! is originally registered with the BOI as a new IT service firm in the field
of application service provider on a non-pioneer status.  Under such
registration, Level Up! is entitled to certain tax incentives, which includes a
four-year ITH from January 2003 and tax credit for taxes on duties on materials
used in export products for ten years starting January 2003.  On April 2004,
the BOI approved Level Up!&#146;s request for upgrading its status from non-pioneer
to pioneer in connection with its IT service activity in the field of
application service provider for entertainment and educational project.  Accordingly,
the ITH period was extended from four to six years.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Wolfpac is
registered with the BOI as a new operator of service provider applications.
Under the terms of its registration, it is entitled to certain tax and non-tax
incentives which include, among other things, ITH for four years from February
2004.</p>

<p align=left style='text-align:left;page-break-after:auto;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart
Broadband has three registered activities with the BOI on a pioneer status,
namely: (i) new operator of telecommunications systems (inter-exchange carrier
for data services); (ii) a new information technology service firm in the field
of providing internet services; and (iii) new operator of telecommunications
facilities (nationwide broadband wireless access).  Under the terms of these
registrations, Smart Broadband is entitled to certain tax and non-tax
incentives which include, among other things, an ITH for six years from
February 2001, August 2001 and July 2005, respectively.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Income
derived from non-registered activities with the BOI is subject to the normal
income tax rate enacted as at the balance sheet date.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Consolidated
tax incentives availed for the six months ended June 30, 2006 and 2005 amounted
to Php125 million and Php43 million, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">On May 24, 2005, the President signed into law
Republic Act No. 9337 (the &#147;Act&#148;), which took effect on November 1, 2005.  The
Act, among others, introduced the following changes:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">a.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Regular corporate income tax rate
for domestic corporations and resident/ non-resident foreign corporations
increased to 35% (from 32%) beginning November 1, 2005 and the rate will be
reduced to 30% beginning January 1, 2009.  The regular corporate income tax
rate shall be applied by multiplying the number of months covered by the new
rate with the taxable income of the corporation during the period, divided by
twelve months.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">b.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
VAT rate increased from 10% to 12%
effective February 1, 2006.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">c.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Input VAT on capital goods should
be spread evenly over the useful life or sixty months, whichever is shorter, if
the acquisition cost, excluding the VAT component thereof, exceeds one million
pesos.</p>

<p align=left style='text-align:left;page-break-after:auto;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Input
VAT credit in every quarter shall not exceed 70% of the output VAT when
taxpayer is in an excess input VAT position.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Our
deferred income tax assets have been recorded to the extent that such deferred
tax assets are expected to be utilized against sufficient future taxable profit.
We had unrecognized deferred tax asset of Php2,896 million largely pertaining
to asset impairment as at June 30, 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our unaudited consolidated unutilized NOLCO as at
June 30, 2006 is detailed as follows:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0"><b>Year
 Incurred</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Year
 Expiring</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(in
 million pesos)</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2003</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">11,229</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,059</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">14,329</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Tax benefit at 35%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,015</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p style="margin-top:0;margin-bottom:0">Unrecognized deferred
 income tax assets as at June 30, 2006 (Unaudited)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,001</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our unaudited consolidated MCIT as at June 30, 2006
is detailed as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0"><b>Year
 Incurred</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Year
 Expiring</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(in
 million pesos)</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2003</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">484</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"> 526</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK34">&nbsp;</a></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7.   Earnings Per Common Share</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The following table presents information
necessary to calculate the earnings per common share:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:21.8pt;
 margin-bottom:0in;margin-left:27.2pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:.05pt;
 margin-bottom:0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:.05pt;
 margin-bottom:0in;margin-left:4.7pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:.05pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Basic</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Diluted</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:26.95pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:18.2pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited) </p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:13.7pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:8.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Net income attributable to equity holders of PLDT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,306</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,306</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">16,520</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Dividends on preferred
 shares</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(228)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(228)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(756)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(24)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Dividends on preferred stock subject to mandatory
 redemption <br>
 charged to interest expense for the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Accretion of preferred stock subject to mandatory
 redemption</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">235</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Foreign exchange gain on preferred stock subject to mandatory redemption</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(478)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net income applicable to common shares</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,078</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,078</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15,764</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">16,307</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0">(in thousands, except per share amounts)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Outstanding common shares at beginning of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>180,789</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>180,789</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">170,468</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">170,468</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>823</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>823</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Average incremental number of shares under ESOP
 during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>40</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">66</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Common shares equivalent of preferred shares deemed
 dilutive:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Preferred Stock Series A to FF (Note 16)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,219</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Global Depositary Shares/Preferred Stock Series III
 (Note 16)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7,908</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-.4pt' style="margin-top:0;margin-bottom:0">Preferred Stock Series VII (Note 17)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,842</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-indent:-17.6pt' style="margin-top:0;margin-bottom:0">Weighted average number of common shares for the
 period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>181,612</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>181,652</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">170,532</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">185,567</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Earnings per common share</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php83.02</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php83.00</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php92.44</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php87.88</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK23"><b>Dividends Declared For The Six Months Ended June 30,
2006</b></a></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Approved</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Record</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Payable</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Preferred Stock Subject to <br>
 Mandatory Redemption</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 V</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 17, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4.675</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 13, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">July 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4.675</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 VI</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 17, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$0.09925</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 13, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">July 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">0.09925</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 VII</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 17, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY10.179725</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 13, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">July 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10.179725</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Charged
 to income</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">  70</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>10% Cumulative Convertible <br>
 Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series CC</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">January 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">February 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1.00</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 DD</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">January 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 EE</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 28, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 27, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">  20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><a
 name="OLE_LINK43"></a><a name="OLE_LINK38"><b>Cumulative
 Non-Convertible Redeemable Preferred Stock</b></a></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 IV*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">January 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 23, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 9, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 26, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 15, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">  24</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Common Stock</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 20, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 20, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php28.00</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">5,072</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Charged
 to retained earnings</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">5,116</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>*    </i><i>Dividends are
declared based on total amount paid up.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name=cashandcash></a><b>&nbsp;</b></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>8.   Property, Plant and
Equipment</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:104.02%;margin-left:.9pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Cable and wire facilities</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Central office equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Cellular facilities</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Buildings</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Vehicles, furniture, and other work equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Communications satellite</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Information origination/<br>
 termination equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Land and</b></p>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b> land improvements</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Property under construction</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=10 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:8.05pt'>
 <td   colspan=11 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.05pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>At December 31, 2005 (Audited)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">107,781</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">82,353</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">61,031</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">19,739</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">27,923</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">10,560</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">7,918</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,438</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">11,794</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">331,537</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Accumulated depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(42,180)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(45,337)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(29,410)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(5,145)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(21,065)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(6,083)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(5,083)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(260)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(154,563)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Net book value</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">65,601</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">37,016</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">31,621</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">14,594</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">6,858</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,477</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,835</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,178</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">11,794</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">176,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=11 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30, 2006 (Unaudited)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Net book value at beginning of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">65,601</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">37,016</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">31,621</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">14,594</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">6,858</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,477</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,835</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,178</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">11,794</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">176,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Additions/Transfers &#150; net</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">1,321</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(72)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,443</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">342</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">1,068</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">555</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">5,025</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">12,682</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Disposals/Retirements</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(38)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(63)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(206)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(339)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Translation differences charged directly to
 cumulative translation adjustments</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(2,473)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(4,540)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3,998)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(572)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3,307)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(314)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(267)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(14)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(15,485)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Net book value at end of period</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">64,414</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">32,381</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">32,003</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">14,364</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,602</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,170</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">3,121</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,164</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">16,613</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">173,832</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=11 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0"><b>June 30, 2006 (Unaudited)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">94,197</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">73,639</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">65,199</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">17,398</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">23,230</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">10,589</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">7,677</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,308</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">16,613</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">310,850</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;text-indent:-8.1pt' style="margin-top:0;margin-bottom:0">Accumulated depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(29,783)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(41,258)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(33,196)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(3,034)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(18,628)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(6,419)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(4,556)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(144)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(137,018)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Net book value</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">64,414</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">32,381</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">32,003</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">14,364</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,602</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">4,170</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">3,121</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2,164</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">16,613</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">173,832</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Substantially all our telecommunications equipment is
purchased from outside the Philippines.  Our significant sources of financing
for such purchases are foreign loans requiring repayment in currencies other
than Philippine pesos, principally in U.S. dollars (see <i>Note 17 &#150; Interest-bearing
Financial Liabilities</i>).  Interest, using an average capitalization rate of
9%, and net foreign exchange losses capitalized to property, plant and
equipment qualified as borrowing costs for the six months ended <br>
June 30, 2006 and 2005 were as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.9%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.85pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:49.55pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-left:45.05pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>302</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">203</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange loss (gains)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(156)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">As at June
30, 2006 and December 31, 2005, the undepreciated capitalized net foreign
exchange losses which qualified as borrowing costs amounted to Php4,338 million
and Php4,276 million, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The consolidated useful lives of the assets are
estimated as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:81.22%;margin-left:54.9pt;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Buildings</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">25
 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Central
 office equipment</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15
 &#150; 20 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cable
 and wire facilities </p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10
 &#150; 25 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Information
 origination and termination equipment</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5
 &#150; 15 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communications satellite</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Vehicles,
 furniture and other work equipment</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3
 &#150; 10 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cellular
 facilities</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3
 &#150; 10 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">Land
 improvements</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10
 years</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We recognized additional depreciation and amortization
charges of Php4,233 million and Php240 million for the six months ended June
30, 2006 and 2005, respectively, due to a change in the estimated useful lives
of certain of our network assets owing to continuing network upgrade and
expansion.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Property,
plant and equipment includes the following amounts for capitalized leases as at
June 30, 2006 and December 31, 2005:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.88%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>June 30, 2006 (Unaudited)</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.1pt;text-align:center' style="margin-top:0;margin-bottom:0">December
 31, 2005 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p style='line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='text-align:center;line-height:80%' style="margin-top:0;margin-bottom:0"><b>Central
 office equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='text-align:center;line-height:80%' style="margin-top:0;margin-bottom:0"><b>Vehicles,
 furniture and other network equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style=';text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Central office equipment</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:.05pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Vehicles, furniture and other network equipment</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.95pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>447</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,082</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,529</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0">1,039</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0">1,400</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Less accumulated
 depreciation</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>331</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>852</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,183</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0">293</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0">719</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0">1,012</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 116</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b> 230</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 346</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0">  68</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.4pt;text-align:right' style="margin-top:0;margin-bottom:0"> 320</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right' style="margin-top:0;margin-bottom:0"> 388</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following table summarizes all changes to the asset retirement obligations as
at June 30, 2006 and December 31, 2005:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='height:11.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30,<br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asset retirement obligations at beginning of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>752</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">638</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>43</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additional liability recognized during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>14</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Settlement of obligations</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(4)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(28)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asset retirement obligations at end of period (Note 18)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 805</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 752</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>9.   Investments in Associates</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse;width:96.94% !msorm;
 border-collapse:collapse !msorm'>
 <tr style='height:11.6pt' style='height:11.6pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:11.6pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">ACeS International Limited, or AIL</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,614</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,614</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Mabuhay Space Holdings Limited</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,017</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,013</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Stradcom International Holdings, Inc.</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>616</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">616</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philweb Corporation</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>427</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">BayanTrade Dotcom, Inc.</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>97</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">ePDS, Inc.</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-top:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,777</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-top:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,346</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less accumulated impairment losses and equity share in net losses of
 associates</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,332</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,331</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:8.6pt;text-indent:-8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total cost and accumulated
 impairment losses and equity share in net losses of associates</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 445</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">  15</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of ACeS Philippines in AIL</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at June 30, 2006, ACeS Philippines has a 20%
investment in AIL, a company incorporated under the laws of Bermuda.  AIL owns
the Garuda I Satellite and the related system control equipment in Batam, Indonesia.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
December 1998, AIL and its 95% owned subsidiary, PT Asia Cellular Satellite,
entered into an Amended and Restated Credit Agreement, or Amended Agreement, to
amend the original Credit Agreement entered into by PT Asia Cellular Satellite
and its bank creditors in 1997.  Under the Amended Agreement, AIL has, among
others, assigned to the banks as collateral all of its tangible properties,
including the Garuda I Satellite, the system control facilities and system
control equipment.  On September 30, 2002, PT Asia Cellular Satellite, AIL, as
guarantor, P.T. Bank Internasional Indonesia, as security agent, and various
banks signed the Rescheduling Agreement, which amended the terms of the Amended
and Restated Credit Agreement dated December 29, 1998, moving the principal
repayment dates to agreed periods with the final maturity date on January 31,
2012, see <i>Note 20 &#150; Related Party Transactions</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">AIL has incurred recurring significant operating
losses, negative operating cash flows, and significant levels of debt.  The
financial condition of AIL was partly due to the National Service Providers&#146;,
or NSPs, inability to generate the amount of revenues originally expected as
the growth in subscriber numbers have been significantly lower than budgeted.
These factors raise substantial doubt about AIL&#146;s ability to continue as a
going concern.  On this basis, we recognized an impairment provision in respect
of our investment in AIL amounting to Php1,614
million in 2003.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investment
of Mabuhay Satellite in Mabuhay Satellite Space Holdings Limited, or MSHL</i></b></p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;punctuation-wrap:simple;text-autospace:
none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">In 1996, Mabuhay
Satellite entered into a Joint Venture Agreement, or JVA, with Space
Systems/Loral Inc., or SS/L, to form MSHL for the purpose of providing
high-power Ku-Band satellite transmission services using the payload which was
added by SS/L aboard Agila II.  Under the terms of the JVA, SS/L is required to
convey title to the additional payload service to MSHL in consideration for
SS/L&#146;s 35% equity interest in MSHL and Mabuhay Satellite is required to pay
SS/L US$19 million for a 65% equity interest in MSHL.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">In 2000, SS/L filed a Notice of Default and Termination against Mabuhay
Satellite arising from the latter&#146;s alleged failure to amicably resolve its
unpaid obligation to SS/L under the JVA.  In 2002, the arbitration panel handed
down its decision and provided for payment by Mabuhay Satellite to SS/L of the
principal amount of US$10 million plus accrued interest at 9% per annum.  On
June 30, 2003, Mabuhay Satellite and SS/L concluded a US$15 million settlement
agreement under which Mabuhay Satellite leased two transponders under a
transponder agreement on a life-term basis to SS/L and had offset the lease
charges due from SS/L and its receivables from Loral Skynet Network Services,
Inc. (formerly known as the Loral Cyberstar, Inc.), among others, for a full
and final settlement of the arbitration decision.  The agreement was
subsequently approved by Mabuhay Satellite&#146;s creditors in March 2004.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">In accordance with the
settlement agreement, Mabuhay Satellite and SS/L shall proceed to dissolve the
joint venture under a separate agreement, for which each of the parties shall
receive title over such number of transponders owned by the joint venture in
proportion to their respective interests.  On the basis of the joint venture
dissolution, we recognized an impairment provision in respect of our investment
in MSHL of Php431 million in 2004.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of ePLDT in Stradcom International
Holdings, Inc., or SIHI</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">ePLDT has a 22.5% interest
in convertible securities of SIHI, the parent company of Stradcom Corporation,
which has an existing concession agreement with the Philippine Government for
the modernization of the Philippine Land Transportation Office, including the
computerization of driver&#146;s license issuance, vehicle registration and traffic
adjudication systems.  SIHI has been incurring losses from the start of
operations due to Stradcom Corporation&#146;s continuous losses and consistent
excess of current liabilities over current assets.  On this basis, we
recognized an impairment provision in respect of our investment in SIHI of
Php616 million in 2004.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investment
of ePLDT in Philweb Corporation, or Philweb</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
May 2006, ePLDT subscribed to newly issued common shares of Philweb equivalent
to 20% of the total outstanding capital stock at a price of Php2 centavos per
share or an aggregate amount of Php502 million.  Of the total subscription
price, Php427 million was paid by ePLDT on closing date.  The portion of the
unpaid subscription price amounting to Php25 million shall be paid by ePLDT at
the same time as the Philweb majority stockholder pays the remaining unpaid
portion of the subscription pursuant to a general call on subscription to be
made by Philweb&#146;s board of directors.  The balance of Php50 million shall be
paid upon the lapse of the post-closing price adjustment periods.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Philweb
is primarily engaged in internet-based gaming, through its appointment as
Principal Technology Service Provider under the Marketing Consultancy Agreement
for Internet Sports Betting and Internet Casino with the Philippine Amusement
and Gaming Corporation, or PAGCOR.  As of end April 2006, Philweb offers
Internet Sports Betting in over 230 PAGCOR Internet Sports Betting Stations and
over 40 Internet Casino Stations nationwide.  Philweb is the first Philippine
internet company to be listed on the PSE.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investment
of ePLDT in BayanTrade Dotcom, Inc., or BayanTrade</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">BayanTrade
was incorporated and registered with the Securities and Exchange Commission, or
SEC, on August 8, 2000 to provide:  (a) business-to-business electronic
purchasing marketplace to link buyers and suppliers of good services over the
Internet; (b) electronic catalogue purchasing facilities over the Internet to
buyers and suppliers; (c) link-up with similar horizontal markets and vertical
markets across the Asia-Pacific Region and the world; and (d) such facilitating
services incidental to the business.  BayanTrade is an e-procurement joint
venture established together with six of the Philippines&#146; leading
conglomerates.  ePLDT&#146;s initial shareholding in BayanTrade was originally
20.5%, which was subsequently diluted to 19.17% in August 2004 due to an equity
call to which ePLDT did not subscribe.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
September 2005, ePLDT received 4,794,615 bonus warrants from BayanTrade which
entitles ePLDT to purchase 2,794,615 common shares at a price of Php0.50 per
share at any time on or before <br>
 August 31, 2010.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Investment
of ePLDT in ePDS, Inc., or ePDS</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On June 30, 2003, ePLDT signed a JVA with DataPost Pte Ltd., or DataPost, a subsidiary of
Singapore Post, and G3 Worldwide ASPAC, or Spring, pursuant to which the
parties formed ePDS, a bills printing company which will do laser printing and
enveloping services for statements, bills and invoices, and other value-added
services to companies in the Philippines.  ePLDT has a 50% interest in ePDS,
while DataPost has a 30% interest.  Spring, the largest international mail
services provider, owns the remaining 20%.  ePDS has an initial paid-up capital
of Php11 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In October 2005, ePDS&#146; Board of Directors approved the
declaration of a 100% stock dividend on its common stock equivalent to Php11
million.  The stock dividends were issued from the increase in authorized
capital stock of ePDS which was approved by the SEC in June 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Summarized Financial Information of Equity Investees</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:1.8pt;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
following table presents summarized financial information in conformity with
Philippine GAAP for equity investees for which we have significant influence as
at June 30, 2006 and December 31, 2005 and for the six months ended June 30,
2006 and 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:3.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Noncurrent assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,471</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,388</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Current assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,066</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">652</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Capital deficiency</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(10,360)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(10,787)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Noncurrent liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,105</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">11,242</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Current liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,792</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,585</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;page-break-after:
 avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;page-break-after:
 avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>353</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">412</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Revenues less
 cost of revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>267</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">318</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>238</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">276</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net loss</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(231)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(188)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10. Investment Properties</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse;width:96.94% !msorm;
 border-collapse:collapse !msorm'>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.85pt' style='page-break-inside:
 avoid !msorm;height:13.85pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm;height:13.85pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.85pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance
 at beginning of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>701</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">743</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Disposals</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(10)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net loss
 from fair value adjustments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;page-break-after:
 avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>691</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">701</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Investment
properties are stated at fair values, which has been determined based on the
latest valuations performed by an independent firm of appraisers.  The
valuation undertaken was based on an open market value, supported by market
evidence in which assets could be exchanged between a knowledgeable willing
buyer and a knowledgeable willing seller in an arm&#146;s-length transaction at the
date of valuation, in accordance with international valuation standards.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>11. Goodwill and Intangible Assets</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Movements in the goodwill and intangible assets during
the periods are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:13.9pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, 2006 (Unaudited)</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.9pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:.05pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Goodwill</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:.05pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Intangible assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Intangible assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:.05pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:4.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Cost:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt' style='page-break-inside:
 avoid !msorm;height:9.45pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=left style='margin-left:9.0pt;text-align:left' style="margin-top:0;margin-bottom:0">Balance at beginning of
 period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,942</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,991</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,933</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,934</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,991</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,925</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt' style='page-break-inside:
 avoid !msorm;height:9.0pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=left style='margin-left:9.0pt;text-align:left' style="margin-top:0;margin-bottom:0">Additions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>348</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>55</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 403</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">   8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,290</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,046</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,336</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,942</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,991</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,933</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:5.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Accumulated amortization and
 impairment:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=left style='margin-left:9.0pt;text-align:left' style="margin-top:0;margin-bottom:0">Balance at beginning of
 period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(438)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(446)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(884)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(438)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(181)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(619)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=left style='margin-left:9.0pt;text-align:left' style="margin-top:0;margin-bottom:0">Additions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(140)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(140)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(265)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(265)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(438)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(586)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,024)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(438)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(446)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(884)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.25pt' style='page-break-inside:
 avoid !msorm;height:6.25pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Net balance</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,852</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,460</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,312</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,504</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,545</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,049</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Intangible assets include technology application with
an estimated useful life of three years arising from the acquisition of Wolfpac
and certain intangible assets arising from the acquisition of Smart Broadband
in 2004.  In December 2005, an independent appraiser completed the valuation
work for certain of Smart Broadband&#146;s intangible assets and determined goodwill
amounting to Php1,415 million at the time of acquisition.  Smart Broadband&#146;s
intangible asset composition and estimated useful lives were revised as
follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:81.22%;margin-left:54.9pt;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Licenses</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">18 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Spectrum</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">15 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Technology</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">5 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Customer base</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3 years</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In 2006, ePLDT acquired a 60% equity interest in Level
Up!, to strengthen our on-line gaming business.  Fair value of Level Up!&#146;s net
assets, determined provisionally, was assessed to be equal to its book value,
which resulted in goodwill amounting to Php348 million at the time of
acquisition.  Intangible assets pertaining to Level Up!&#146;s customer base was
provisionally determined at Php55 million with an estimated useful life of
three years.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>12. Notes Receivable</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:1.8pt;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of ePLDT in Debt Securities of Technology
Support Services, Inc., or TSSI (formerly First Advance Multi-Media
Entertainment Corp., or FAME)</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">On June 1, 2004, ePLDT and FAME entered into an agreement whereby ePLDT would grant a seven-year
zero-coupon loan to FAME amounting to US$3.1 million.  Upon maturity of the
loan, which is at the end of seven (7) years from issuance, ePLDT may require
FAME to redeem or pay the loan at a redemption value amounting to US$6.1
million.  At any time during the life of the outstanding loan, ePLDT may
convert the loan into 20% of the total outstanding capital stock of FAME.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
August 20, 2004, FAME changed its corporate name to TSSI.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On September 14, 2004, ePLDT entered into a second agreement with TSSI whereby ePLDT would
grant another seven-year zero coupon loan to TSSI amounting to US$3.1 million
with the same terms and features as the first loan.  As at December 31, 2005, the aggregate loans of ePLDT to TSSI amounted to US$6.2 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">As at June
30, 2006, ePLDT has not yet converted its investment in debt securities into TSSI&#146;s
shares of stock. TSSI is a systems integrator for the internet and mobile
telephone gaming project.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
debt instrument was initially recorded at fair value computed as the present
value of estimated future cash flows and subsequently measured at amortized
cost at effective yield.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13. Cash and Cash Equivalents</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.85pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.85pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:13.85pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash on
 hand and in banks</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,928</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,496</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Temporary
 cash investments</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>23,038</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,568</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25,966</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,064</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Cash in
banks earn interest at prevailing bank deposit rates.  Temporary cash investments
are made for varying periods of up to two months depending on our immediate
cash requirements, and earn interest at the prevailing short-term deposit
rates.  Due to the short-term nature of such transactions, the carrying value
approximates the fair value of our temporary cash investments.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>14. Trade and Other Receivables</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of receivables from:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Customers and carriers</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>23,955</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,475</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others (Notes 20, 22 and 23) </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,377</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,184</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25,332</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25,659</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less allowance for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>17,488</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,546</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,844</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,113</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Receivables
from carriers represent receivables arising from interconnection agreements
with other telecommunications carriers.  The aforementioned receivable balances
are shown net of related payables to the same telecommunications carriers
because an established right of offset exists.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On October
10, 2002, PLDT entered into a Receivables Purchase Deed, or RPD, with a foreign
financial institution, or the Purchaser, under which PLDT agreed (1) to sell
its receivables from certain eligible foreign carriers for an advance payment
of US$50 million, of which, US$7 million remains outstanding as at June 30, 2006,
and (2) to service, administer and collect the receivables on behalf of the
Purchaser.  Under the RPD, the Purchaser has no recourse against PLDT should an
eligible carrier fail or refuse to settle the assigned/purchased receivables,
except when PLDT commits a breach of its representations and warranties under
the RPD.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Sale of receivables under the RPD amounted to US$3 million (Php152 million) and US$6
million (Php338 million) for the six months ended June 30, 2006 and 2005,
respectively.  Loss on sale of receivables under the RPD amounted to US$0.34
million (Php17 million) and US$0.67 million (Php37 million) for the six months
ended June 30, 2006 and 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>15. Inventories
and Supplies</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.96%;margin-left:18.3pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, <br>
 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Terminal and cellular phone
 units:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At net
 realizable value</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>759</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">806</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,058</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,024</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Spare parts and supplies:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At net
 realizable value</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,720</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">493</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,622</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,376</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Others:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At net
 realizable value</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>183</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">249</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At cost</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>183</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">249</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.1pt;text-align:justify' style="margin-top:0;margin-bottom:0">At lower of
 cost or net realizable value</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,662</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,548</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>16. Equity</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
movement of PLDT&#146;s capital account follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.18%;margin-left:23.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Preferred Stock</b> &#150; Php10 par value</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Series <br>
 A to FF</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>III</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>IV</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Total Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Common Stock</b>
 &#150; Php5 par value</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=center style='margin-left:3.55pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>No. of Shares</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p style='' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>No. of Shares</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=8 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Authorized</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">823</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php8,230</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">234</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php1,170</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Outstanding</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:20.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Balance at January 1, 2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">409</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"> 450</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,497</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php851</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.05in' style="margin-top:0;margin-bottom:0">Issuance</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.05in' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.5pt;text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(67)</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Balance at December 31, 2005 (Audited)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0"> 407</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">  36</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"> 443</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,433</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0"> 181</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:20.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Balance at January 1, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0"> 407</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">  36</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"> 443</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,433</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0"> 181</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.05in' style="margin-top:0;margin-bottom:0">Issuance</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.05in' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Balance at June 30, 2006 (Unaudited)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.15in;text-align:right' style="margin-top:0;margin-bottom:0"> 407</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0">  36</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"> 443</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,430</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:17.25pt;text-align:right' style="margin-top:0;margin-bottom:0"> 183</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php914</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Preferred Stock</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The preferred stock is non-voting, except as
specifically provided by law, and is preferred as to liquidation.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The Series
A to FF 10% Cumulative Convertible Preferred Stocks earn cumulative dividends
at an annual rate of 10%.  After the lapse of one (1) year from the last day of
the year of issuance of a particular series of 10% Cumulative Convertible
Preferred Stock, any holder of such series may convert all or any of the shares
of 10% Cumulative Convertible Preferred Stock held by him into fully paid and
non-assessable shares of Common Stock of PLDT, at a conversion price equivalent
to 10% below the average of the high and low daily sales price of a share of
Common Stock on the PSE, or if there shall have been no such sales on the PSE
on any day, the average of the bid and the asked prices of a share of Common
Stock of PLDT at the end of such day on such Exchange, in each such case
averaged over a period of 30 consecutive trading days prior to the conversion
date, but in no case shall the conversion price be less than the price set by the
Board of Directors which, as at June 30, 2006, was Php5.00 per share.  The
number of shares of Common Stock issuable at any time upon conversion of one
share of subscriber investment plan, or SIP.  Cumulative Convertible Preferred
Stock shall be determined by dividing Php10.00 by the then applicable
conversion price.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">In case the shares of Common Stock at anytime outstanding shall be
subdivided into a greater or consolidated into a lesser number of shares, then
the minimum conversion price per share of Common Stock shall be proportionately
decreased or increased, as the case may be, and in the case of a stock
dividend, such price shall be proportionately decreased, provided, however,
that in every case the minimum conversion price shall not be less than the par
value per share of Common Stock.  In the event the relevant effective date for
any such subdivision or consolidation of shares or stock dividend occurs during
the period of 30 trading days preceding the presentation of any shares of 10%
Cumulative Convertible Preferred Stock for conversion, a similar adjustment
shall be made in the sales prices applicable to the trading days prior to such
effective date utilized in calculating the conversion price of the shares
presented for conversion.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
case of any other reclassification or change of outstanding shares of Common
Stock, or in case of any consolidation or merger of PLDT with or into another
corporation, the Board of Directors shall make such provisions, if any, for
adjustment of the minimum conversion price and the sales price utilized in
calculating the conversion price as the Board of Directors, in it sole
discretion, shall be deemed appropriate.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">At
PLDT&#146;s option, the Series A to FF 10% Cumulative Convertible Preferred Stocks
are redeemable at par value plus accrued dividends five years after the year of
issuance.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On December 6, 2005, the Board of Directors designated 100,000 shares of serial preferred
stock as Series GG 10% Cumulative Convertible Preferred Stock for issuance
throughout 2006.  Confirmation of exemption of this transaction under Section
10.2 of the Securities Regulation Code is still pending with the SEC.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
Series III Convertible Preferred Stock earns cumulative dividends at an annual
rate of US$3.50 a share payable quarterly, free and clear of Philippine
withholding taxes.  It is convertible into Common Stock at the option of the
holder at any time, at the conversion price of US$29.19 per share of Common
Stock (equivalent to a conversion ratio of 1.7129 shares of Common Stock for each
share of Series III Convertible Preferred Stock, each share of Series III
Convertible Preferred Stock being valued for this purpose at its reference
amount of US$50 a share), subject to adjustment in certain events, and is not
redeemable.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK65"></a><a name="OLE_LINK64">On
October 24, 2005, PLDT issued to JPMorgan, as depositary, and to the holders of
the Series III Convertible Preferred Stock a notice of mandatory conversion of
all of its outstanding 4,616,200 <br>
Series III Convertible Preferred Stock into shares of PLDT Common Stock.  The
conditions for mandatory conversion under the terms of the Series III Preferred
Stock have been satisfied, including: <br>
(i) that the average closing price of PLDT&#146;s ADSs for the 30-day period ending
seven days prior to the date in which notice of the mandatory conversion was
given was above US$29.19 a share (ii) that there were no dividends in arrears
on any shares of the Series III Convertible Preferred Stock, and (iii) that
PLDT had sufficient distributable reserves to pay the fixed preferential dividends
on the shares of Series III Convertible Preferred Stock, calculated down to and
including the mandatory conversion date.</a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
November 2005, PLDT issued 710,891 shares of common stock on account of the
voluntary conversion of 415,023 shares of Series III Convertible Preferred
Stock.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at December 19, 2005, all of the outstanding shares of Series III Convertible
Preferred Stock were mandatorily converted into PLDT Common Stock (the
&#147;Mandatory Conversion Date&#148;) wherein each share of Series III Convertible
Preferred Stock was converted into 1.7129 shares of Common Stock.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Series IV Cumulative Non-Convertible Redeemable
Preferred Stock earns cumulative dividends at an annual rate of 13.5% based on
the paid-up subscription price.  It is redeemable at the option of PLDT at any
time one year after subscription and at the actual amount paid for such stock,
plus accrued dividends.  On February 26, 2002, the Board of Directors called
for the payment of a portion of the balance of the subscription price of the
Series IV Cumulative Non-Convertible Redeemable Preferred Stock amounting to
Php72 million, which was paid on March 5, 2002.  On March 22, 2002, PLDT
redeemed 60 million shares out of the 360 million subscribed shares of its
Series IV Cumulative Non-Convertible Preferred Stock and paid Php72 million,
representing the redemption price plus unpaid dividends up to the date of
redemption.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The provisions of certain subscription agreements
involving preferred stock have an effect on the ability of PLDT to, without
written consent, sell certain assets and pay cash dividends unless all
dividends for all past quarterly dividend periods have been paid and provision
has been made for the currently payable dividends.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>17. Interest-bearing
Financial Liabilities</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">This
account consists of the following:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse;width:96.94% !msorm;
 border-collapse:collapse !msorm'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-bottom:1.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Long-term portion of interest-bearing financial
 liabilities - <br>
 net of current portion:</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term
 debt (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>72,410</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">84,860</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Obligations
 under capital lease (Notes 8 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>269</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">381</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Preferred
 stock subject to mandatory redemption (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,854</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">11,974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>82,533</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">97,215</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Current portion of interest-bearing financial
 liabilities:</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:0in;
 margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:0in;
 margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:0in;
 margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term
 debt maturing within one year (Note 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,281</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">18,684</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Obligations
 under capital lease maturing within one year (Notes 8 and 24)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>828</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">717</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>19,109</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">19,401</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Unamortized
debt discount, representing debt issuance costs and any difference between the
fair value of consideration given or received on initial recognition, included
in the financial liabilities are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;page-break-after:
 avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Long-term debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,676</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,829</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Obligations under capital
 lease (Note 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>573</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">602</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Preferred stock subject to
 mandatory redemption</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,535</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,916</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total
 unamortized debt discount</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10,784</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,347</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following table describes all changes to unamortized debt discount as at June
30, 2006 and December 31, 2005.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse;width:96.94% !msorm;
 border-collapse:collapse !msorm'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;page-break-after:avoid;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December
 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt' style='page-break-inside:
 avoid !msorm;height:8.0pt !msorm'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm;height:8.0pt'>
 <p style='margin:0in;margin-bottom:.0001pt;page-break-after:
 avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Unamortized debt discount at
 beginning of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>13,347</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">18,581</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Revaluations</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>643</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,114)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Additions during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>100</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">198</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Settlements and conversions during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,483)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,436)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Accretion during the period
 charged to interest expense (Note 5)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,823) </b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,882)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Unamortized debt discount at end of period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,784</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">13,347</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>Long-term
Debt</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Long-term debt consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Description</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Interest Rates</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>June 30, 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>U.S.
 Dollar Debt:</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-align:justify' style="margin-top:0;margin-bottom:0">Export Credit Agencies-Supported Loans:</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Kreditanstalt f&#252;r Wiederaufbau, or KfW</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">5.65%
 - 7.58% and US$ LIBOR + 0.55% - 2.5%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$224</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php11,912</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$254</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php13,489</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Finnish
 Export Credit, plc, or Finnvera</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">7.53%
 - 7.75% and US$ LIBOR + 0.05%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>79</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,184</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">105</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,552</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Nippon Export and Investment Insurance <br>
 of Japan, or NEXI</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 1%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>37</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,971</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,612</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">5.83%
 - 6.60% and US$ LIBOR + 0.15% - 1.60% and GOVCO&#146;s cost + 0.20%</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>19</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,021</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,473</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 359</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>19,088</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 436</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,126</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Fixed Rate Notes</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">7.85%
 - 11.375%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>842</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>44,838</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">987</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">52,354</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Term Loans:</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">Debt
 Exchange Facility</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">2.25%
 and US$ LIBOR + 1%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>170</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,040</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">165</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,748</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">GSM
 Network Expansion Facilities</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">4.49%
 - 4.515% and US$ LIBOR + 3.25%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>137</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,318</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">86</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,562</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 0.40% - 3.625%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>613</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">978</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Restructured Loans</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 1%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>51</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,720</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">90</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,767</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Satellite Acquisition Loans</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 1.75% and 5.6%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>50</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,655</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,040</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>1,621</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>86,272</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$1,839</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">97,575</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>Japanese
 Yen Debt:</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">JBIC&#146;s Overseas Investment Loan, or OIL</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JP&yen;</b><b>5,576</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,593</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JP&yen;6,970</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Export Credit Agency-Supported Loan &#150; <br>
 NEXI Supported Loan</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">JP&yen;
 LIBOR + 1.70%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,573</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JP&yen;</b><b>5,576</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,593</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JP&yen;8,543</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,848</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>Philippine
 Peso Debt:</i></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Peso Fixed Rate Corporate Notes</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">15%
 - 15.816%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,577</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,576</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Term Loan:</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-align:justify' style="margin-top:0;margin-bottom:0">Secured Term Loans</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">12.83%
 - 24% and 90-day <br>
 PHIBOR + 3%</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>34</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">166</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Restructured Loans</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">91-day
 T-Bill rate + 1%</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>215</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">379</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,826</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,121</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>90,691</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">103,544</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Less
 portion maturing within one year</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,281</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,684</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Total long-term debt </p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php72,410</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php84,860</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Note:
Amounts presented are net of unamortized debt discount and debt issuance costs.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
scheduled maturities of our outstanding consolidated long-term debt at nominal
values as at June 30, 2006 are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.82%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>U.S. Dollar Loans</b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>JP</b><b>Y</b><b> Loans</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Php Loans</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In U.S. Dollar</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In JP</b><b>Y</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=6 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.85pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2006(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">4,211</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">1,394</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">648</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0"><a
 name="OLE_LINK48"></a><a name="OLE_LINK22">793</a></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">5,652</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">345</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">18,379</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">2,788</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">1,297</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">19,712</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">124</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">6,602</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">1,394</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">648</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">7,274</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">281</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">14,948</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">14,972</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">3,337</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">834</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">4,171</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2011 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">872</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">46,416</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">46,586</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,764</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">93,893</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">5,576</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">2,593</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.85pt;text-align:right' style="margin-top:0;margin-bottom:0">1,881</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.0pt;text-align:right' style="margin-top:0;margin-bottom:0">98,367</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   July 1, 2006
through December 31, 2006</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>U.S.
Dollar Debt:</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>Export
Credit Agencies-Supported Loans</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
order to obtain imported components for our network infrastructure in
connection with our expansion and service improvement programs, we obtained
loans extended and/or guaranteed by various export credit agencies.  These
financings account for a significant portion of our indebtedness.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Kreditanstalt f&#252;r Wiederaufbau, or KfW</i></p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">KfW, a German state-owned development bank, is PLDT&#146;s
largest single creditor.  As at June 30, 2006, we owed US$224 million aggregate
principal amount of debt to KfW, as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<ul style='margin-top:0in' type=disc>
 <li>US$173 million provided
 under various export credit agency-backed facilities, of which US$63
 million was in connection with our expansion and service improvement
 programs and US$110 million in connection with the US$149 million
 refinancing facility discussed below; and</li>
</ul>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<ul style='margin-top:0in' type=disc>
 <li>US$51 million provided for
 the 15% downpayment portion and credit facilities without
 guarantee/insurance cover from the export credit agencies, of which US$30
 million was in connection with the US$149 million refinancing facility
 discussed in the following paragraphs.</li>
</ul>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On January 25, 2002, PLDT signed two loan agreements
with KfW, which provided PLDT with a US$149 million facility to refinance in
part the repayment installments under its existing loans from KfW due from
January 2002 to December 2004.  The facility is composed of a nine-year loan,
inclusive of a three-year disbursement period and a two-year grace period
during which no principal is payable.  It partly enjoys the guarantee of
HERMES, the export credit agency of the Federal Republic of Germany.  We have
drawn US$140 million (Php7,449 million) under this facility as at June 30, 2006.
PLDT waived further disbursements under this refinancing facility effective September 1, 2004.  Thus, the undrawn portion of US$9 million was cancelled.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Of
the amounts outstanding under these KfW loans, US$22 million will mature in
2006, US$72 million will mature in 2007, US$55 million will mature in 2008,
US$44 million will mature in 2009 and US$31 million will mature in 2010.
Principal amortizations on these loans are generally payable in equal
semi-annual installments.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Finnish
Export Credit, plc, or Finnvera</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, US$80 million principal amount of Smart&#146;s debt was provided
by various banks under an export credit agency-backed facility in connection
with Smart&#146;s GSM expansion program.  This facility is covered by guaranty from
Finnvera, the Finnish export credit agency, for 100% of political and
commercial risk for the refinancing facility of GSM Phases 5A and 5B.  This is
the only remaining outstanding facility guaranteed under Finnvera.  Other
Finnvera Guaranteed GSM loan facilities were already fully paid in the
aggregate amount of US$16.50 million for GSM Phases 3 and 4 loan facilities on
April 28, 2006, and aggregate of US$5.8 million for GSM Phases 1 and 2 loan
facilities on October 31, 2005.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
US$100 million refinancing facility was obtained on February 11, 2005 in
relation to Smart&#146;s GSM Phases 5A and 5B loans which were prepaid last March 1,
2005 with outstanding balances of US$60 million and US$41 million,
respectively, at the time of prepayment.  This refinancing facility is payable
semi-annually over five years starting September 1, 2005 with final repayment
due in March 2010.  The principal benefit of refinancing the Phase 5 loan was
the savings from a lower interest margin on the refinancing facility.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Of
the amount outstanding under the remaining Finnvera guaranteed loan, US$10
million will mature in 2006, US$20 million will mature in 2007, US$20 million
will mature in 2008, US$20 million will mature in 2009 and US$10 million will
mature in 2010.  Principal amortization on this loan is payable in equal
semi-annual installments.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Nippon
Export and Investment Insurance of Japan, or NEXI</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
November 28, 2002, Smart signed a US$100 million term loan facility supported
by NEXI, of which US$60 million was drawn on November 28, 2003 and US$40
million on April 5, 2004.  This loan is payable semi-annually over four years
in eight equal installments starting May 28, 2004 with final repayment due in
November 2007.  The outstanding balance as at June 30, 2006 was US$38 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Other
Export Credit Agency Supported Loans</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
has also obtained loans extended and/or guaranteed by other export credit
agencies, including the Export-Import Bank of the United States, and the
respective export credit agencies of France, Italy and Australia, in the aggregate outstanding principal amount of US$15 million as at June 30, 2006.
Smart, likewise, obtained loans guaranteed by the export credit agencies of Norway and Italy amounting to US$4 million.  Of the amounts outstanding under these loans, US$6
million will mature in 2006, US$9 million will mature in 2007, US$2 million
will mature in 2008, US$1 million will mature in 2009 and US$1 million will
mature in 2010.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>Fixed
Rate Notes</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
has the following non-amortizing fixed rate notes outstanding as at June 30,
2006 and December 31, 2005:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.0%;margin-left:18.4pt;border-collapse:collapse;width:96.0% !msorm;
 border-collapse:collapse !msorm'>

 <tr style='page-break-inside:avoid;height:6.6pt' style='page-break-inside:
 avoid !msorm;height:6.6pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Principal<br>
 Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Interest<br>
 Rate</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Maturity<br>
 Date</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>June 30, 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$300,000,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">8.350%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">March 6, 2017</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$296</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php15,753</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$296</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php15,700</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$250,000,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">May 15, 2012</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>243</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,960</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">243</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">12,902</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$175,000,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">10.500%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2009</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>174</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,259</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">174</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,223</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$110,068,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">7.850%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>110</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,849</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">138</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,320</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$
 19,310,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">10.625%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">May 15, 2007</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>19</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,017</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,105</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">US$112,168,000</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:10.7pt;text-align:right' style="margin-top:0;margin-bottom:0">9.250%</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">June 30, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,104</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-right:10.7pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin-right:9.05pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>842</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php44,838</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$987</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 1.5pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php52,354</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>Term</u></i><i><u> Loans</u></i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>US$283
Million Term Loan Facility, or Debt Exchange Facility</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
July 2, 2004, Smart acquired from Piltel&#146;s creditors approximately US$289
million, or 69.4%, in the aggregate of Piltel&#146;s outstanding restructured debt
at that time, in exchange for Smart debt and a cash payment by Smart.  In particular,
Smart paid an amount in cash of US$1.5 million, or Php84 million and issued new
debt of US$283.2 million, or Php15,854 million, at fair value of Php8,390
million, net of debt discount amounting to Php7,464 million.  As at June 30,
2006, unamortized discount amounted to Php6,347 million.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The breakdown of the total amount of Smart debt
issued to participating Piltel creditors is as follows:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2007 Facility in the amount of
US$0.2 million payable in full in December 2007;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2008 Facility in the amount of
US$2.9 million payable in full in December 2008; and</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2014 Facility in the amount of
US$280.1 million payable in full in June 2014.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Interest
for the above facilities is payable every quarter at a floating rate of three
months US$ LIBOR plus 1.00% for the 2007 and 2008 facilities, and a fixed rate
of 2.25% per annum for the 2014 facility.  Furthermore, a portion of the 2014
facility amounting to US$144 million has a variable yield option whereby the
creditors have an option to elect for an early repayment at a discount either
in December 2007 at 52.5% of the relevant debt amount or in December 2008 at
57.5% of the relevant debt amount.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>GSM
</i><i>Network Expansion Facilities</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On
September 13, 2004, Smart signed a US$104 million 5-year term loan facility
supported by Finnish Export Credit Ltd. as the lender with ABN AMRO Bank,
Banque National de Paribas, Calyon, DBS Bank and Sumitomo Mitsui Banking
Corporation as the Lead Arrangers.  The full amount of the facility was drawn
in November 22, 2004, of which US$73 million remained outstanding as at June
30, 2006.  The loan is payable over five years in ten equal semi-annual
payments starting May 2005 with final repayment in November 2009.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On June 8,
2001, Smart signed its GSM Phase 5A financing comprised of US$195 million
loans, of which US$30 million is owed to Nordic Investment Bank, or NIB, US$15
million to Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden
N.V., or FMO, of the Netherlands and US$150 million to Finnvera.   The NIB loan
balance of US$12.0 million was prepaid in full on December 8, 2005, and the FMO
loan balance of US$4.09 million was prepaid in full on March 1, 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">On August 8, 2005, Smart signed a US$30 million
commercial facility with NIB to partly finance the related Phase 8 GSM
equipment and services contracts.  The facility is a 5-year term loan payable
semi-annually in 10 equal installments commencing six months from the first
drawdown date at a floating rate of US$ LIBOR plus .815% margin per annum (with
an option to fix the rate prior to the drawdown date).  The facility was drawn
on July 11, 2006 for the full amount of US$30 million.  The first installment payment
will commence on January 2007. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On August 10, 2005, Smart signed a loan facility for
its GSM Phase 8 financing in the amount of US$70 million.  The facility was
awarded to the Bank of Tokyo Mitsubishi Ltd., Mizuho Corporate Bank Ltd,
Standard Chartered Bank and Sumitomo Mitsui Banking Corporation as the Lead
Arrangers, with Finnish Export Credit Ltd., as the Lender on Record.  Smart
opted to utilize only a total of US$67 million which was drawn in February 15,
2006 and March 13, 2006 for US$10 million and US$57 million respectively.  The
balance of US$3 million was canceled.  After the first repayment on March 1, 2006,
US$66 million remained outstanding as at June 30, 2006.  The facility is a
5-year term loan payable in 10 equal semi-annual installments with final
repayment on September 1, 2010.  Interest is payable semi-annually at a fixed
rate of 4.515% per annum.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>Restructured
Loans</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On June 4,
2001, Piltel completed the restructuring of approximately Php41 billion of
indebtedness and other claims owed to banks, trade creditors, bondholders and
preferred shareholders, representing 98% of its total liabilities as at that
date.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
a result of the restructuring, 50% of the financial debt of each participating
creditor was released in consideration for the allotment of Piltel Series K
Class I Convertible Preferred Stock, which shares were immediately and
mandatorily converted into PLDT Convertible Preferred Stock.  One PLDT Series
V, VI or VII Convertible Preferred Stock was issued for every five (5) Piltel
Series K Class I Convertible Preferred Stock.  Approximately half of the
remaining 50% of all participating creditors&#146; (except for bondholders and
preferred shareholders) financial debt became their participation in a Tranche
B Loan in the same currency as their previous financial debt and the other half
became their participation in a Tranche C Loan also in the same currency as
their previous financial debt.  In the case of bondholders and preferred
shareholders, the remaining 50% of their financial debt became their
participation in the Conversion Notes Facility and in a single Tranche Peso
loan, or the Term Notes Facility, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Additional
creditors participated in the debt restructuring plan, such that only
convertible bonds with principal amount of US$0.7 million (approximately US$0.9
million redemption price at the option of the holders) remain unrestructured.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Piltel&#146;s residual long-term debt to third parties
consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Description</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>June
 30, 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">December
 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Restructured debts</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Philippine Pesos</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">10 year Tranche B</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php110</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php190</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15 year Tranche C</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>105</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>215</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">379</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">U.S. Dollars</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">10 year Tranche B</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$5</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>235</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">400</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15 year Tranche C</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>4</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>224</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">395</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15 year Conversion Notes
 Facility</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>43</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,261</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,972</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>52 </b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,720</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$90 </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">4,767</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,935</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,146</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Unrestructured debt</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">U.S. Dollars</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Convertible bonds</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$1</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>49</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,984</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,195</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Less portion maturing within one
 year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>316</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">103</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php2,668</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php5,092</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following is a summary of the key economic terms
relating to the restructuring of the financial debt taking the form of Tranche
B Loan, Tranche C Loan, Term Notes Facility and Conversion Notes Facility.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=1 cellspacing=0 cellpadding=0
 style='width:95.26%;margin-left:23.4pt;border-collapse:collapse;border:none'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:solid windowtext 1.0pt;
 border-left:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Tranche B Loans</b></p>
 </td>
 <td   valign=bottom style=' border:solid windowtext 1.0pt;
 border-left:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Tranche C Loans</b></p>
 </td>
 <td   valign=bottom style=' border:solid windowtext 1.0pt;
 border-left:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Term Notes Facility</b></p>
 </td>
 <td   valign=bottom style=' border:solid windowtext 1.0pt;
 border-left:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Conversion Notes Facility</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">Final
 maturity</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">10 years from June 4, 2001</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">15 years from June 4, 2001</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">15 years plus 10 days<br>
 from June 4, 2001</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">15 years from June 4, 2001</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   rowspan=2 valign=top style=' border-top:none;
 border-left:solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Amortization</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 1 and 2  &#150;  0.00%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 1 and 2  &#150;  0.00%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 1 and 2  &#150;  0.00%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 1 and 2  &#150;  0.00%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 3 to 9  &#150;  0.10%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 3 and 4  &#150;  0.10%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 3 to 14  &#150;  0.10%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 3 and 4  &#150;  0.10%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:none;border-left:
 solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 10  &#150;  99.30%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 5  &#150;  2.00%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 15  &#150;  98.80%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 5  &#150;  1.05%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:none;border-left:
 solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 6 to 14  &#150;  10.00%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 6 to 9  &#150;  5.05%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:none;border-left:
 solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 15  &#150;  7.80%</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 10  &#150;  54.65%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:none;border-left:
 solid windowtext 1.0pt;border-bottom:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Years
 11 to 14  &#150;  5.00%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">Year
 15  &#150;  3.90%</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Interest rate</p>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border-top:none;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0"><b>Peso facility</b>
 &#150; Philippine 91-day treasury bill rate, or T-Bill Rate, or the average of the
 91-day T-Bill Rate and the 90-day Philippine inter-bank offered rate, or
 PHIBOR, if 90-day PHIBOR is different from the T-Bill Rate by more than 2.50%,
 plus 1.00% p.a.</p>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0"><b>U.S. dollar facilities</b> &#150; London interbank rate for U.S. dollar deposits, or
 LIBOR, for three-month U.S. dollar deposits plus 1.00% p.a.</p>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0"><b>Yen facility</b>
 &#150; LIBOR interbank rate for Yen deposits for three-month deposits plus 1.00%
 p.a.</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0">181-day T-Bill Rate or the average of the 181-day
 T-Bill Rate and the 6-months PHIBOR, if 6-months PHIBOR is different from the
 T-Bill Rate by more than 2.50%, plus 1.00% p.a.</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-align:justify' style="margin-top:0;margin-bottom:0">LIBOR for three-month deposits plus 1.00% p.a.</p>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest payment dates</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:none;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Quarterly in arrears</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:none;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Semi-annually</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Under the
terms of Piltel&#146;s debt restructuring plan, PLDT issued a Letter of Support, or
LOS, for the benefit of Piltel and its creditors under which PLDT has agreed to
cover any funding shortfalls of Piltel up to a maximum amount of US$150 million
less all amounts paid or committed to be paid to or on behalf of Piltel or any
of its subsidiaries or affiliates on or after March 23, 2000. Under the LOS,
PLDT is required to provide funding to Piltel in the event that the cash flows
from Piltel&#146;s operations fall short of the amount required by it to discharge
in full its obligations to any creditor of Piltel and all its operating and
financing subsidiaries and affiliates.  PLDT is subject to contractual
restrictions limiting the amount of financial support it can provide to Piltel
up to US$150 million.  As at June 30, 2006 and December 31, 2005, the remaining
undrawn balance available under the PLDT LOS was US$50 million, approximately
Php2,672 million and Php2,666 million, due to prior investments made from March
23, 2000 to December 31, 2002 aggregating to US$100 million through PLDT&#146;s
subscription to Series J Class I preferred shares of Piltel.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Piltel&#146;s
restructured obligations are secured by substantially all present and future
assets of Piltel under the Mortgage Trust
Indenture, or MTI, dated June 4, 2001 between Piltel and Chase Manhattan Bank
as security agent for the creditors, which established the security
arrangements relating to the restructured debts.  The participating creditors
(other than the participating holders of the Peso Term Notes Facility) will
share equally in first ranking security, while non-participating creditors and
the participating holders of the Peso Term Notes Facility will share equally in
second ranking security created under the MTI.  Such mortgage was approved by
at least two-thirds of Piltel&#146;s stockholders at its annual meeting on April 18,
2001 and by the NTC on May 18, 2001.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">Piltel likewise agreed to pay into a dedicated account
(a Sinking Fund Account) the amount by which <br>
(a) earnings before interest, tax, depreciation and amortization, and
exceptional items for a financial year is greater than (b) 200% of the
projected debt service costs and permitted capital expenditure for the
following financial year (the Excess Cash flow).  The money in that Sinking
Fund Account will be used (before any drawings are made under the LOS) to fund
cash flow deficiencies of Piltel.  Also, if actual capital expenditure for a
financial year differs from the projected capital expenditure, Piltel will
either pay into the Sinking Fund Account established at the end of that year an
amount equal to any over-projection of capital expenditure or will be entitled
to withdraw funds, if any, equal to any under-projection.  Any credit balance
in the Sinking Fund Account after two financial years will be used to prepay
all participating creditors on a pro rata basis.</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">On June 5, 2006, Piltel made a partial voluntary
prepayment of principal under its Philippine peso facility, U.S. dollar
facilities, Japanese yen facility and conversion notes facility.  The voluntary
prepayment was made in lieu of depositing the Excess Cash Flow from the
operations of Piltel&#146;s business into a Sinking Fund Account.  The aggregate
voluntary prepayment amount was Php9,325 million (Php6,393 million to Smart and
Php2,932 million to third party creditors) or US$176 million (US$ 121 million
to Smart and US$55 million to third party creditors), which was applied
proportionally to the various debt facilities as set out in the Intercreditor Agreement
dated June 4, 2001.</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:16.55pt;text-autospace:none' style="margin-top:0;margin-bottom:0">On July 7, 2006, Piltel, PLDT and JPMorgan Chase Bank,
N.A. (Manila Branch), as Security Agent on behalf of the Finance Parties under
the Intercreditor Agreement (ICA), agreed to the amendment of Clause 25 of the
ICA to allow the amendment of any term of the Mortage Trust Indenture (MTI) and
the release and sale of certain properties or assets from the security
Interests created by the MTI upon the instructions of the Creditor
Representatives.  On the same date, and following the effectivity of the
amendment of the ICA, Piltel and the Security Agent, executed the Amendment to
the Mortgage Trust Indenture, pursuant to which Piltel is allowed to sell or
dispose of certain categories of assets or properties with the consent of the
Majority Bank Creditors, the Majority Trade Creditors and the Trustee,
provided, however that for as long as Avenue Asia holds majority of Piltel&#146;s
Conversion Notes, the prior consent of Avenue Asia will be required for (i) any
sale or disposition of any of the real properties of Piltel, and (ii) any sale
or disposition of assets to Smart, PLDT or any of its affiliates.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Satellite</i><i>
Acquisition Loans</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite has an existing Credit Agreement with the Export-Import Bank of the United States, or Ex-Im Bank, to finance a portion of the cost of purchasing the Agila II
Satellite.  In 2004, Ex-Im Bank of the United States approved, in principle,
the re-profiling of Mabuhay Satellite&#146;s US$42 million debt with them by
extending the maturity of the loan by 1&#189; years to July 15, 2007 and reducing
the interest rate by 1% to 5.6%.  The revised repayment terms have been
approved by the majority of the local creditor banks.  As at June 30, 2006, the
remaining outstanding loan amounted to US$16 million (Php833 million).</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Mabuhay Satellite also has an existing Omnibus
Agreement with a syndicate of local banks, or the Banks, which includes
issuance of irrevocable standby Letters of Credit which as at June 30, 2006 has
an aggregate stated value not exceeding US$17 million (Php879 million) in favor
of U.S. Ex-Im Bank, as security under the Credit Agreement and a term loan to
Mabuhay Satellite in the aggregate amount of US$34 million (Php1,822 million),
which will mature on various dates from 2006 to 2007. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite has constituted in favor of the Banks: (a) a first mortgage on its
leasehold rights under a lease agreement entered into with the Subic Bay
Metropolitan Authority and the components of the satellite system; (b) an
assignment of its rights under its purchase contract for the satellite system;
(c) an assignment of its rights under the transponder lease contracts to be
entered into with its shareholders and other parties and the revenues
therefrom; and (d) an assignment of the applicable proceeds of insurance to be
taken on the satellite system.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, the Banks have approved Mabuhay&#146;s request to extend the
maturity of the Satellite&#146;s loan under the Omnibus Agreement by two years to
October 20, 2009, with a 1% increase in the margin on the deferred amount.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Japanese
Yen Debt:</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>JBIC
JP&yen;9,760 Million Overseas </i><i>Investment</i><i> Term Loan</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
July 26, 2002, PLDT signed a loan agreement with JBIC for a credit facility of
JP&yen;9,760 million under JBIC&#146;s OIL program.  The loan, which was drawn on July
31, 2002, is being amortized semi-annually beginning March 21, 2005 and will
mature on March 21, 2008.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>NEXI Supported JP&yen;5,615 Million</i> <i>Syndicated Term Loan Facility</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;punctuation-wrap:
simple;text-autospace:none;vertical-align:baseline' style="margin-top:0;margin-bottom:0">On June 11, 2003, PLDT
signed a JP&yen;5,615 million syndicated term loan facility supported by NEXI, of
which JP&yen;2,520 million was drawn and all outstanding amounts were repaid in
full on June 13, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Philippine
Peso Debt:</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:31.5pt' style="margin-top:0;margin-bottom:0"><i>Php2,</i><i>770</i><i>
Million Peso Fixed Rate Corporate Notes</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
connection with PLDT&#146;s service improvement and expansion programs, PLDT has
entered into two loan agreements, pursuant to each of which PLDT issued fixed
rate corporate notes in three tranches.  Interest on each tranche is payable
semi-annually.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Under the first loan agreement, PLDT borrowed an
aggregate amount of Php1,500 million, of which
Php230 million matured on November 11, 2002, Php500 million matured on November 9, 2004 and Php770 million will mature on November 9, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Under
the second loan agreement, PLDT borrowed an aggregate amount of Php1,270 million, of which Php360
million matured on June 9, 2003, Php100
million matured on June 9, 2005 and Php810
million will mature on June 9, 2010.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:31.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Term Loans</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:31.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Secured</i><i>
Term Loans</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:45.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php150 Million </i><i>Term Loan Facility</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On March 4, 2002, ePLDT entered into a three-year loan
facility with Philippine Bank of Communications amounting to Php150 million.
The loan facility was fully drawn on December 31, 2002 and payable in seven
quarterly installments, with a grace period of one year, beginning year 2003.
The quarterly principal payments of Php15 million started in June 2003 with a
balloon payment of Php45 million in March 2005.  Interest on this loan was
equivalent to 91-day T-bill rate plus 4% per annum payable quarterly in
arrears.  The loan was secured by ePLDT&#146;s deed of assignment of receivables of
a subsidiary from a foreign customer and an investment in an associate with an
original cost of Php629 million.  This loan was fully paid as at March 31,
2005.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:45.0pt' style="margin-top:0;margin-bottom:0"><i>Php100
Million Term Loan Facility</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
March 15, 2004, ePLDT entered into another three-year term loan facility with
Asia United Bank amounting to Php100 million for the payment of its outstanding
short-term bank loan facility and for other working capital requirements.  The
loan facility was fully drawn as at December 31, 2004.  The loan is to be
repaid in nine equal quarterly installments starting March 2005 with final
repayment in March 2007.  Interest on the loan is equivalent to 90-day PHIBOR
plus 3% per annum payable quarterly in arrears.  The loan is secured by a
Mortgage Trust Indenture Agreement, or MTIA, on a parcel of land with a
carrying value of Php279 million as at December 31, 2004.  As at June 30, 2006,
the outstanding balance of this loan amounted to Php33 million which will
mature within the first quarter of 2007.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p style='margin-left:45.0pt' style="margin-top:0;margin-bottom:0"><i>Php149
Million Term Loan Facility</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
January 2006, Vocativ, a wholly-owned call center subsidiary of ePLDT,
partially prepaid Php89 million out of its outstanding five-year term loan
facility of Php109 million with Asia United Bank for the payment of its
additional capital expenditures and working capital requirements.  Under the
terms of the loan, principal payment is to be paid in 14 equal quarterly
installments starting April 2006 with final repayment in July 2009.  Interest
on the loan is equivalent to 90-day PHIBOR plus 3% per annum payable quarterly
in arrears.  The loan is secured by a Mortgage Participation Certificate
against the MTIA between ePLDT and Asia United Bank Corporation &#150; Trust and
Investments Group dated March 15, 2004 on a parcel of land, which excludes the
buildings and improvements.  The remaining balance of Php20 million was
pre-terminated in April 2006.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Debt Covenants</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our debt instruments contain restrictive covenants,
including covenants that could prohibit us from paying dividends on common
stock under certain circumstances, and require us to comply with specified
financial ratios and other financial tests, calculated in conformity with
accounting principles generally accepted in the Philippines, at relevant measurement
dates, principally at the end of each quarterly period.  We have complied with
all of our maintenance financial ratios as required under our loan covenants
and other debt instruments.  In addition, we are required to comply with
certain financial ratios for the incurrence of capital expenditures in excess
of US$10 million and incurrence of indebtedness.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The principal factors that can negatively affect our
ability to comply with these financial ratios and other financial tests are
depreciation of the Philippine peso relative to the U.S. dollar, poor operating
performance of PLDT and its consolidated subsidiaries, impairment or similar
charges in respect of investments or other long-lived assets that may be
recognized by PLDT and its consolidated subsidiaries and increases in our
interest expenses.  Interest expense may increase as a result of various
factors including issuance of new debt, the refinancing of lower cost
indebtedness by higher cost indebtedness, depreciation of the Philippine peso, the
lowering of PLDT&#146;s credit ratings or the credit ratings of the Philippines, increase in reference interest rates, and general market conditions.  Since
approximately 98% of PLDT&#146;s total consolidated debts are denominated in foreign
currencies, principally in U.S. dollars, many of these financial ratios and
other tests are negatively affected by any weakening of the peso.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
debt instruments contain a number of other negative covenants that, subject to
certain exceptions and qualifications, restrict PLDT&#146;s ability to take certain
actions without lenders&#146; approval, including: (a) incurring additional
indebtedness; (b) prepaying other debt; (c) making investments; <br>
(d) extending loans; (e) extending guarantees or assuming the obligations of
other persons; (f) paying dividends or other distributions or redeeming,
repurchasing or otherwise acquiring shares of PLDT&#146;s capital stock; (g)
disposing of all or substantially all of its assets or of assets in excess of
specified thresholds of its tangible net worth; (h) entering into management
contracts providing for the management of its business or operations by a third
party; (i) creating any lien or security interest; <br>
(j) permitting set-off against amounts owed to PLDT; (k) merging or
consolidating with any other company; (l) entering into transactions with
stockholders and affiliates; and (m) entering into sale and leaseback
transactions. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Further,
certain of PLDT&#146;s debt instruments contain provisions wherein PLDT may be
required to repurchase or prepay certain indebtedness in case of change in
control of PLDT or if the ownership of our shares of common stock held by NTT
Communications falls below a certain threshold.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
debt instruments also contain customary and other default provisions that
permit the lender to accelerate amounts due or terminate their commitments to
extend additional funds under the debt instruments. These default provisions
include: (a) cross-defaults and cross-accelerations that permit a lender to
declare a default if PLDT is in default under another debt instrument; in some
cases, the cross-default provision is triggered upon a payment or other default
permitting the acceleration of PLDT&#146;s debt, whether or not the defaulted debt
is accelerated.  In other cases, the cross-default provision requires the
defaulted loan to be accelerated.  In some debt instruments, the cross-default
provision will be triggered only if the principal amount of the defaulted
indebtedness exceeds a threshold amount specified in these debt instruments; (b)
failure by PLDT to meet certain financial ratio covenants referred to above;
(c) the occurrence of any material adverse change in circumstances that a
lender reasonably believes materially impairs PLDT&#146;s ability to perform its
obligations under its debt instrument with the lender; (d) the revocation,
termination or amendment of any of the permits or franchises of PLDT in any
manner unacceptable to the lender; (e) the abandonment, termination or
amendment of the project financed by a loan in a manner unacceptable to the
lender; (f) the nationalization or sustained discontinuance of all or a
substantial portion of PLDT&#146;s business; and <br>
(g) other typical events of default, including the commencement of bankruptcy,
insolvency, liquidation or winding up proceedings by PLDT.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart&#146;s
debt instruments contain certain restrictive covenants that require Smart to
comply with specified financial ratios and other financial tests at semi-annual
measurement dates.  The financial tests under Smart&#146;s loan agreements include compliance
with a debt to equity ratio of not more than 1.50:1 and a debt service coverage
ratio of not less than 1.50:1.  Smart has maintained compliance with all of its
financial covenants.  The agreements also contain customary and other default
provisions that permit the lender to accelerate amounts due under the loans or
terminate their commitments to extend additional funds under the loans.  These
default provisions include: (a) cross-defaults and cross-accelerations that
permit a lender to declare a default if Smart is in default under another loan
agreement.  These cross-default provisions are triggered upon a payment or
other default permitting the acceleration of Smart debt, whether or not the
defaulted debt is accelerated; (b) failure by Smart to comply with certain
financial ratio covenants; (c) any reduction in PLDT&#146;s ownership of Smart&#146;s
shares below 51%; (d) any reduction in First Pacific&#146;s and Metro Pacific
Corporation&#146;s collective direct and/or indirect ownership of PLDT&#146;s common
stock below 17.5% of the total common stock outstanding; and (e) the occurrence
of any material adverse change in circumstances that the lender reasonably
believes materially impairs Smart&#146;s ability to perform its obligations under
its loan agreements.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, Piltel was not in compliance with the terms of convertible
bonds with principal amount of US$0.7 million (approximately US$0.9 million
redemption price at the option of the holders).  Piltel may not be able to
restructure or otherwise pay the claims of its unrestructured debt.  However,
default on and acceleration of Piltel&#146;s unrestructured indebtedness does not
create a cross-default under Piltel&#146;s restructured indebtedness or any
indebtedness of PLDT or Smart.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The Credit
and Omnibus Agreements of Mabuhay Satellite imposes several negative
covenants.  In particular, these covenants, among other things, restrict
material changes in Mabuhay Satellite&#146;s nature of business and ownership
structure, any lien upon or with respect to any of its assets or to any right
to receive income, acquisition of capital stock, declaration and payment of
dividends, merger, consolidation and sale with another entity and incurring or
guaranteeing additional long-term debt beyond prescribed amounts.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">ePLDT&#146;s
loan agreement imposes negative covenants which, among other things, restrict
ePLDT in regard to payment of cash dividends or any other income or any capital
distribution to PLDT, voluntary suspension of its entire business operations
for a period of 60 consecutive days, dissolution of its legal existence, and
creation of any encumbrances on the shares pledged.  One of ePLDT&#146;s loan
agreements also requires ePLDT to comply with specified financial ratios and
other financial tests at quarterly measurement dates.  The agreement also
contains customary and other default provisions that permit the lender to
accelerate amounts due under the loan or terminate their commitments to extend
additional funds under the loan.  As at June 30, 2006, ePLDT was in compliance
with all of its financial covenants.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Obligations Under Capital Lease</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
future minimum payments for capitalized leases are as follows as at June 30,
2006:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.92%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(Unaudited)</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">798</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">380</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011 and onwards</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">436</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total minimum lease payments</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,670</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less amount representing interest</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">573</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Present value of net
 minimum lease payments</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,097</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less obligations under
 capital lease maturing within one year (Note 8)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">828</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Long-term portion of obligations under capital lease (Note 8)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 269</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Municipal Telephone Projects</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">In 1993,
PLDT entered into two lease agreements with the Philippine Department of
Transportation and Communications, or DOTC, covering telecommunications
facilities in the province of Bohol and Batangas established under the
Municipal Telephone Act.  Under these agreements, PLDT was granted the
exclusive right to provide telecommunications management services, to expand
services, and to promote the use of the DOTC-contracted facilities in certain
covered areas for a period of 15 years.  Title to the properties shall be
transferred to PLDT upon expiration of the lease term.  As at June 30, 2006,
PLDT&#146;s aggregate remaining obligation under this agreement was approximately
Php858 million.  In case of cancellation, PLDT is liable to pay Php100 million
under each of the two contracts as liquidated damages.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">On June 1, 2004, PLDT served the DOTC a notice of termination of the
lease agreement in respect of the telecommunications system in Bohol which
state of deterioration, obsolescence and disrepair has made it impossible for
PLDT to continue managing, operating, and maintaining the system.  Since 2002,
PLDT has been advising the DOTC of the need to review the viability of the
system as it has infused more than Php200 million for upgrades and maintenance
to keep the system operable.  Further, the enactment of Public
Telecommunications Policy Act, or R.A. No. 7925, which negated the DOTC&#146;s
warranty to grant PLDT the exclusive right to provide telecommunication
services in the areas stipulated, prevented PLDT from achieving the originally
projected profitability, thereby rendering it impossible for PLDT to continue
fulfilling its obligation under the lease agreement.  Although several
discussions have been held since then, no mutually acceptable agreement has
been reached.  On June 30, 2004, the DOTC advised PLDT that the request for
termination of the lease agreement in Bohol has been referred to the Department
of Justice, or DOJ, as government agencies are required to refer all
interpretation of contracts and agreements to the DOJ secretary as
attorney-general of the national government.  On May 5, 2005, PLDT received a letter from the DOTC stating that PLDT is in default for failure to remit to
the DOTC the quarterly installments under the lease agreement.  Due to the
failure of the parties to amicably settle their dispute, on September 28, 2005, PLDT demanded that the dispute be referred to arbitration and that the parties
agree on the composition of the arbitration committee.  <a name="OLE_LINK36"></a><a
name="OLE_LINK35">In response, the DOTC, in a letter dated October 17, 2005,
informed PLDT that pursuant to Executive Order No. 269, series of 2004, dated
January 12, 2004, the existing communications programs and projects implemented
by DOTC were transferred to the Commission on Information and Communications
Technology, or CICT, and that the DOTC had forwarded to CICT PLDT&#146;s letter
dated September 28, 2005.  In a letter dated March 24, 2006, the CICT informed
PLDT that the CICT poses no objection on PLDT&#146;s stated intentions and
preference to refer the unresolved and outstanding issues to the Philippine
Dispute Resolution Center, Inc., or PDRCI, per the arbitration clause of the
lease agreement.  On June 27, 2006, a Request for Arbitration dated June 1,
2006 was filed by PLDT with the PDRCI.  The DOTC has not yet filed its Answer
to the said Request for Arbitration.  As at June 30, 2006, the net book value
of the telecommunications system in Bohol, including PLDT&#146;s additional capital
expenditure relating to the telecommunications system, and corresponding
capital lease obligation amounted to Php</a>21 million and Php735 million,
respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Capital Lease Obligations</i> </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
PLDT Group has various long-term lease contracts for a period of three years
covering various office equipment.  In particular, Smart and Piltel have
capital lease obligations aggregating Php290 million as at June 30, 2006 in
respect of office equipment and facilities.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Under
the terms of certain loan agreements and other debt instruments, PLDT may not
create, incur, assume or permit or suffer to exist any mortgage, pledge, lien
or other encumbrance or security interest over the whole or any part of its
assets or revenues or suffer to exist any obligation as lessee for the rental
or hire of real or personal property in connection with any sale and leaseback
transaction.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Preferred Stock Subject to Mandatory Redemption</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The movements of PLDT&#146;s preferred stock subject to
mandatory redemption follow:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:463.5pt;margin-left:.25in;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, 2006
 (Unaudited)</b></p>
 </td>
 <td  colspan=4 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Series V</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Series VI</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Series VII</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Series V</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Series VI</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Series VII</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=8 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-bottom:1.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of period</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>272</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,321</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,381</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>11,974</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,103</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,440</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,072</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,615</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(216)</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(2,672)</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(2,888)</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,083)</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(507)</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,590)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>9</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>367</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>220</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>596</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">782</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">451</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,485</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revaluation</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(9)</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>181</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>172</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(394)</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,142)</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,536)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 65</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,007</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,782</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>9,854</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">272</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,321</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,381</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,974</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, PLDT had issued 3 million shares of Series V Convertible
Preferred Stock, <br>
5 million shares of Series VI Convertible Preferred Stock and 4 million shares
of Series VII Convertible Preferred Stock in exchange for Series K Class I
Convertible Preferred Stock of Piltel, pursuant to the debt restructuring plan
of Piltel adopted in June 2001.  Shares of Series V, VI and VII Convertible
Preferred Stock are entitled to receive annual dividends of Php18.70 per share,
US$0.397 per share and JP&yen;40.7189 per share, respectively.  Each share of
Series V, VI and VII Convertible Preferred Stock is convertible at any time at
the option of the holder into one PLDT common share.  On the date immediately
following the seventh anniversary of the issue date of the Series V and Series
VI Convertible Preferred Stock and on the eighth anniversary of the issue date
of the Series VII Convertible Preferred Stock, the remaining outstanding shares
under these series will be mandatorily converted into PLDT common shares.
Under a put option exercisable for 30 days, holders of common shares received
on mandatory conversion of the Series V, VI and VII Convertible Preferred Stock
will be able to require PLDT to purchase such PLDT common shares for Php1,700
per share, US$36.132 per share, and JPY4,071.89 per share, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
Series V Convertible Preferred Stock was designated as compound instrument consisting
of liability and equity components.  The fair value of the Convertible
Preferred Stock was determined at issue date, of which the fair value of the
liability component as at date of issuance is recorded as &#147;Preferred Stock
Subject to Mandatory Redemption&#148; and is included under the &#147;Interest-bearing
Financial Liabilities&#148; account in the consolidated balance sheets.  The
residual amount was assigned as the equity component.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
cost of each foreign currency component Convertible Preferred Stock Series VI
and VII, was designated as debt instrument with embedded call options.  The
fair value of the Convertible Preferred Stock was determined at issue date, of
which the fair value of embedded call options was bifurcated and accounted for
separately, see Note 2 &#150; Summary of Significant Accounting Policies and
Practices and Note 24 &#150; Financial Assets and Liabilities.  The residual amount
was assigned as liability components and recorded as &#147;Preferred Stock Subject
to Mandatory Redemption&#148; and is included under the &#147;Interest-bearing Financial
Liabilities&#148; account in the consolidated balance sheets.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
difference between the amount designated as liability components of the Series
V, VI and VII Convertible Preferred Stock at issue date and the aggregate redemption
value is accreted over the period up to the put option date using the effective
interest rate method.  Accretions added to &#147;Preferred Stock Subject to
Mandatory Redemption&#148; and charged to interest as at June 30, 2006 and 2005
amounted to Php596 million and Php818 million, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&#147;Preferred
Stock Subject to Mandatory Redemption&#148; amounted to Php9,854 million and
Php11,974 million as at June 30, 2006 and December 31, 2005, respectively,
after revaluation of Series VI and VII Convertible Preferred Stock to the
exchange rates at balance sheet dates and after giving effect to the above
accretions, conversions and additional issuances.  As at June 30, 2006 and
December 31, 2005, 5,350,606 shares and 3,376,743 shares, respectively, of the
Convertible Preferred Stock have been converted into PLDT common shares.  The
outstanding shares of Series V, VI and VII Convertible Preferred Stock as at
June 30, 2006 were 52,478, 2,613,460 and 3,842,000, respectively.  The
aggregate redemption value of the outstanding Series V, VI and VII Convertible
Preferred Stock amounted to Php12,389 million and Php15,890 million as at June
30, 2006 and December 31, 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
corresponding dividends on these shares charged as interest expense amounted to
Php93 million and Php132 million for the six months ended June 30, 2006 and
2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>18. Other
Noncurrent Liabilities</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">This
account consists of:</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;punctuation-wrap:hanging;
 text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:10.25pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrual of capital expenditures under long-term financing</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,656</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,769</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Asset retirement obligations (Note 8)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>805</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">752</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Prepayments received under receivable purchase facility
 (Note 14)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>307</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">976</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>70</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>14</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,852</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7,600</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>19. Accrued
Expenses and Other Current Liabilities</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse;width:96.94% !msorm;
 border-collapse:collapse !msorm'>
 <tr style='height:13.9pt' style='height:13.9pt !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:13.9pt'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;punctuation-wrap:hanging;
 text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:13.9pt'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:8.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Accrued utilities and related expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,163</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,559</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Accrual for
 payment for unused sick leave and other employee benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,069</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,760</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrued interest and other related costs (Notes 17 and 20)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,016</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,003</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Accrued taxes and related expenses</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,114</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">760</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Payable in installment purchase of
 equity investment</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,278</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>735</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,946</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>13,097</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">13,306</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK18">&nbsp;</a></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>20. Related Party Transactions</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>a.   Air Time Purchase Agreement
between PLDT and AIL and Related Agreements</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In March 1997, PLDT entered into a National Service
Provider, or Founder NSP, Air Time Purchase Agreement with PT Asia Cellular
Satellite, as amended in December 1998 and as assigned and transferred to AIL,
under which PLDT was granted the exclusive right to sell ACeS services in the Philippines.  In exchange, the Air Time Purchase Agreement required PLDT to purchase from
PT Asia Cellular Satellite at least US$5 million worth of air time annually
over ten years, commencing on January 1, 2002, the purported date of commercial
operations of the Garuda I Satellite.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In the event that PT Asia Cellular Satellite&#146;s
aggregate billing revenue is less than US$45 million in any given year, the Air
Time Purchase Agreement states that PLDT has to make supplemental air time
purchase payments not to exceed US$15 million per year during the ten-year
term.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT and the other founder NSPs are endeavoring to
amend the Air Time Purchase Agreement due to the occurrence of partial
satellite loss, changes in the primary business of ACeS and other events
affecting the business.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In March 2003, PLDT, together with the other founder
NSPs, entered into a Standstill Agreement with AIL suspending the application
and enforcement of the minimum and supplemental air time payments under the
original Air Time Purchase Agreement.  The parties agreed that AIL shall
provide PLDT and the other founder shareholders, with unlimited use of air time
for the year 2003 in exchange for a fixed fee in the amount of US$3.8 million
for PLDT.  Moreover, PLDT was also obliged to purchase from AIL 13,750
satellite phone units in 2003 at US$395 F.O.B. per unit, subject to quarterly
price adjustments.  The parties to the Standstill Agreement also agreed to
negotiate in good faith and use their best efforts to reach an agreement on a
revised Air Time Purchase Agreement before November 15, 2003 that would cover,
among other things, the amended minimum and supplemental air time payment
provisions subject to the approval of AIL&#146;s creditors.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On February 10, 2004, notwithstanding the ongoing
negotiations, AIL advised PLDT of the termination of the Standstill Agreement
and the reinstatement of the terms under the original Air Time Purchase
Agreement effective January 1, 2002, following the lapse of the November 15,
2003 deadline set in the Standstill Agreement for the negotiation of a revised
Air Time Purchase Agreement.  Negotiations are continuing with the relevant
parties towards an amicable settlement of this matter.  As at June 30, 2006,
PLDT&#146;s outstanding payables under the original Air Time Purchase Agreement was
Php4,096 million.  See <i>Note 22 &#150; Contractual Obligations and Commercial
Commitments</i> and <i>Note 23 &#150; Provisions and Contingencies </i>for further
discussion.<a name="OLE_LINK24"></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT also entered into a Founder NSP Operating
Agreement with PT Asia Cellular Satellite on March 12, 1997, under which PLDT
may:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
authorize distributors to resell
ACeS services in the Philippines upon prior approval from <br>
PT Asia Cellular Satellite; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
appoint agents to solicit and bill
PLDT&#146;s or its authorized distributors&#146; subscribers for ACeS services and to
sell terminals on behalf of PLDT.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Under an Assignment and Assumption Agreement dated December 29, 1998, PT Asia Cellular Satellite agreed to assign and transfer to AIL of PT
Asia Cellular Satellite&#146;s rights under the Founder NSP Air Time Purchase
Agreement and Founder NSP Operating Agreement.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0">Under an Acknowledgment of the Assignment of Air Time
Purchase Agreement entered into on December 29, 1998, by and among PLDT, P.T.
Bank Internasional Indonesia and AIL, PLDT consented to the assignment by AIL
of the Founder NSP Air Time Purchase Agreement to P.T. Bank Internasional
Indonesia, as security agent, for the benefit of the secured parties under the
Security Agreement dated December 29, 1998, which was executed in connection
with the Amended and Restated Credit Agreement dated December 29, 1998 among PT
Asia Cellular Satellite, AIL, P.T. Bank Internasional Indonesia and various
banks.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">On
September 30, 2002, PT Asia Cellular Satellite, AIL, as guarantor, P.T. Bank
Internasional Indonesia, as security agent, and various other banks signed a
Rescheduling Agreement, which amended the terms of the Amended and Restated
Credit Agreement dated December 29, 1998, moving the principal repayment dates
to agreed periods with the final maturity date on January 30, 2012.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>b.   Transactions with Major
Stockholders, Directors and Officers </i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Transactions to which PLDT or any of its subsidiaries is
a party, in which a director or key officer or owner of more than 10% of the outstanding
common stock of PLDT, or any member of the immediate family of a director or
key officer or owner of more than 10% of the outstanding common stock of PLDT
had a direct or indirect material interest, as at June 30, 2006 (unaudited) and
December 31, 2005 (audited) and for the six months ended June 30, 2006 and 2005
(unaudited) are as follows:</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>1.   Cooperation Agreement with the First Pacific
Parties, or FP Parties, NTT Communications and DoCoMo</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0">In
connection with the transfer by NTT Communications of approximately 12.6
million shares of PLDT&#146;s common stock to DoCoMo pursuant to the Stock Sale and
Purchase Agreement dated January 31, 2006 between NTT Communications and
DoCoMo, the FP Parties, NTT Communications and DoCoMo entered into a
Cooperation Agreement, dated January 31, 2006.  Under the Cooperation
Agreement, the relevant parties extended certain rights of NTT Communications under
the Stock Purchase and Strategic Investment Agreement dated September 28, 1999,
as amended and the Shareholders Agreement dated March 24, 2000, to DoCoMo,
including:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
certain contractual veto rights
over a number of major decisions or transactions; and</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
rights relating to the
representation on the board of directors of PLDT and Smart, respectively, and
any committees thereof.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Moreover, key provisions of the Cooperation Agreement
pertain to, among other things:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Restriction on Ownership of
Shares of PLDT by NTT Communications and DoCoMo. </i> Each of NTT Communications and DoCoMo has agreed not
to beneficially own, directly or indirectly, in the aggregate with their
respective subsidiaries and affiliates, more than 21% of then issued and
outstanding shares of PLDT&#146;s common stock.  If such event does occur, the FP
Parties, as long as they own in the aggregate not less than 21% of then issued
and outstanding shares of PLDT&#146;s common stock, have the right to terminate
their respective rights and obligations under the Cooperation Agreement, the
Shareholders Agreement and the Stock
Purchase and Strategic Investment Agreement.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Limitation on Competition.</i>  NTT Communications, DoCoMo and their respective
subsidiaries are prohibited from investing in excess of certain thresholds in
businesses competing with PLDT in respect of customers principally located in
the Philippines and from using their assets in the Philippines in such
businesses. Moreover, if PLDT, Smart or any of Smart&#146;s subsidiaries
intends to enter into any contractual arrangement relating to certain competing
businesses, PLDT is required to provide, or to use reasonable efforts to
procure that Smart or any of Smart&#146;s subsidiaries provide NTT Communications
and DoCoMo with the same opportunity to enter into such agreement with PLDT or
Smart or Smart&#146;s subsidiaries, as the case may be.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Business Cooperation.</i>  PLDT and DoCoMo agreed in principle to collaborate
with each other on the business development, roll-out and use of a W-CDMA
mobile communication network.  In addition, PLDT agreed, to the extent of the
power conferred by its direct or indirect shareholding in Smart, to procure that Smart will (i) become a
member of a strategic alliance group for international roaming and corporate
sales and services and (ii) enter into a business relationship concerning
preferred roaming and inter-operator tariff discount with DoCoMo.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Additional Rights of DoCoMo. </i> Upon NTT Communications, DoCoMo and their
subsidiaries owning in the aggregate 20% or more of the shares of PLDT&#146;s common
stock and for as long as NTT Communications, DoCoMo and their subsidiaries
continue to own in the aggregate 17.5% of the shares of PLDT&#146;s common stock
then outstanding, DoCoMo will be entitled to certain additional rights under
the Cooperation Agreement.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Change in Control.</i>  Each of NTT
Communications, DoCoMo and the FP Parties agreed that to the extent permissible
under applicable laws and regulations of the Philippines and other
jurisdictions, subject to certain conditions, to cast its vote as a shareholder
in support of any resolution proposed by the board of directors of PLDT for the
purpose of safeguarding PLDT from any Hostile Transferee.  A &#147;Hostile
Transferee&#148; is defined under the Cooperation Agreement to mean any person
(other than NTT Communications, DoCoMo, First Pacific or any of their
respective affiliates) determined to be so by the PLDT board of directors and
includes, without limitation, a person who announces an intention to acquire,
seeking to acquire or acquires 30% or more of PLDT common shares then issued
and outstanding from time-to-time or having (by itself or together with itself)
acquired 30% or more of the PLDT common shares announces an intention to
acquire, seeking to acquire or acquires a further 2% of such PLDT common shares
(a) at a price per share which is less than the fair market value as determined
by the board of directors of PLDT as advised by a professional financial
advisor, (b) which is subject to conditions which are subjective or which could
not reasonably be satisfied, (c) without making an offer for all PLDT common
shares not held by it and/or its affiliates and/or persons who, pursuant to an
agreement or understanding (whether formal or informal), actively cooperate to
obtain or consolidate control over PLDT, (d) whose offer for the PLDT common
shares is unlikely to succeed or (e) whose intention is otherwise not bona
fide; provided that, no person will be deemed a Hostile Transferee unless prior
to making such determination, the board of directors of PLDT has used
reasonable efforts to discuss with NTT Communications and DoCoMo in good faith
whether such person should be considered a Hostile Transferee.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Termination.</i>  If NTT Communications, DoCoMo or their respective
subsidiaries cease to own, in the aggregate, full legal and beneficial title to
at least 10% of the shares of PLDT&#146;s common stock then issued and outstanding,
their respective rights and obligations under the Cooperation Agreement and the
Shareholders Agreement will terminate and the Strategic Arrangements (as
defined in the Stock Purchase and Strategic Investment Agreement) will
terminate.  If the FP Parties and their respective subsidiaries cease to have,
directly or indirectly, effective voting power in respect of shares of PLDT&#146;s
common stock representing at least 18.5% of the shares of PLDT&#146;s common stock
then issued and outstanding, their respective rights and obligations under the
Cooperation Agreement, the Stock Purchase and Strategic Investment Agreement,
and the Shareholders Agreement will terminate.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>2.   Integrated i-mode Services Package Agreement
between DoCoMo and Smart</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Integrated i-mode Service Package Agreement was
entered into by Smart and DoCoMo on February 15, 2006, under which DoCoMo
agreed to grant Smart, on an exclusive basis within the territory of the
Philippines for a period of five years, an integrated i-mode service package
including non-transferable license to use the licensed materials and the i-mode
brand, as well as implementation support and assistance and post-commercial
launch support from DoCoMo. Pursuant to this agreement, Smart is required to pay
an initial license fee and running royalty fees based on the revenue arising
from i-mode subscription fees and data traffic.  The initial license fee paid
as at June 30, 2006 amounted to US$1 million or Php53 million.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>3.   Advisory
Services Agreement between DoCoMo and PLDT</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">The
Advisory Services Agreement was entered into by DoCoMo and PLDT on June 5,
2006, in accordance with the Cooperation Agreement between PLDT and DoCoMo.
Pursuant to the Agreement, DoCoMo will provide the services of certain key
personnel in connection with certain aspects of the business of PLDT and
Smart.  Also, the agreement governs the terms and conditions of the
appointments and the corresponding fees related thereto.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>4.   Other Agreements with NTT Communications and/or
its Affiliates</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:22.5pt' style="margin-top:0;margin-bottom:0">PLDT is a party to the following agreements with NTT Communications
and/or its affiliates:</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Advisory Services Agreement</i>.   On March 24, 2000, PLDT entered into an agreement
with NTT Communications, as amended on March 31, 2003 and March 31, 2005, under
which NTT Communications provides PLDT with technical, marketing and other
consulting services for various business areas of PLDT starting April 1, 2000;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Arcstar Licensing Agreement and
Arcstar Service Provider Agreement.   </i>On
March 24, 2000, PLDT entered into an agreement with NTT Worldwide
Telecommunications Corporation under which PLDT markets managed data and other
services under NTT Communications&#146; &#147;Arcstar&#148; brand to its corporate customers
in the Philippines.  PLDT also entered into a Trade Name and Trademark
Agreement with NTT Communications under which PLDT has been given the right to
use the tradename &#147;Arcstar&#148; and its related trademark, logo and symbols, solely
for the purpose of PLDT&#146;s marketing, promotional and sales activities for the
Arcstar services within the Philippines; and</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:54.7pt;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Conventional International
Telecommunications Services Agreement</i>.
On March 24, 2000, PLDT entered into an agreement with NTT Communications under
which PLDT and NTT Communications agreed to cooperative arrangements for
conventional international telecommunications services to enhance their
respective international businesses.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:36.7pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total fees under these agreements amounted to Php100
million and Php114 million for the six months ended June 30, 2006 and 2005,
respectively.  As at June 30, 2006 and December 31, 2005, outstanding obligations
of PLDT amounted to Php40 million and Php23 million, respectively.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>5.   Agreement between Smart and Asia Link B.V., or
ALBV.  </i>Smart has an existing
Technical Assistance Agreement with ALBV for the latter to provide technical
support services and assistance in the operations and maintenance of cellular
business for a period of five years, subject to renewal upon mutual agreement
between the parties.  The agreement provides for quarterly payments of
technical service fees equivalent to 2%
of the net revenues of Smart.  In January 2004, the agreement was amended,
reducing the technical service fees to be paid by Smart to ALBV to 1% of net
revenues effective January 1, 2004.  On February 18, 2004, Smart and ALBV entered into a renewal of the technical service agreement extending the effectivity of
the terms of the agreement to February 23, 2008.  Furthermore, in view of the
acquisition by Smart of Piltel Series K Class I Convertible Preferred Stock
held by PLDT, the parties agreed to make the consolidated net revenues of Smart
the basis for the computation of the 1% royalty payable by Smart to ALBV,
effective from January 1, 2005.  </p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">Smart
also has an existing Services Agreement with ALBV for a period of 25 years
starting January 1, 1999, which shall automatically expire unless renewed by
mutual agreement of both parties.  Under the agreement, ALBV provides advice
and assistance to Smart in sourcing capital equipment and negotiating with
international suppliers, arranging international financing and other services
therein consistent with and for the furtherance of the objectives of the
services.  Service agreement fees were paid for the whole 25-year period.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">ALBV
is a subsidiary of the First Pacific Group.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">Total
fees under these agreements amounted to Php299 million and Php278 million for
the six months ended June 30, 2006 and 2005, respectively.  Outstanding
obligations of Smart under these agreements amounted to Php30 million and
Php194 million as at June 30, 2006 and December 31, 2005, respectively.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>6.   Agreements relating to insurance
companies.</i>  Gotuaco del Rosario and
Associates, or Gotuaco, <br>
acts as the broker for certain insurance companies to cover certain insurable
properties of the PLDT Group.  Insurance premiums are remitted to Gotuaco and
the broker&#146;s fees are settled between Gotuaco and the insurance companies.  In
addition, PLDT has an insurance policy with Malayan Insurance Co., Inc., or
Malayan, wherein premiums are directly paid to Malayan.  Total insurance
expenses under these agreements amounted to Php189 million and Php268 million
for the six months ended June 30, 2006 and 2005, respectively.  Two directors
of PLDT have a direct/indirect interests in or serve as a director/officer of
Gotuaco and Malayan.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK58"></a><a name="OLE_LINK57"><b><i>Compensation
of Key Management Personnel of the PLDT Group</i></b></a></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT Group&#146;s
compensation of key management personnel by benefit type follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.25pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:10.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-left:31.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:10.25pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Short-term
 employee benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>374</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">323</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Share-based
 payments (Note 21)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>282</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">190</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Post-employment
 benefits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>17</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.4pt;text-indent:-.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b> 673</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"> 528</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Each of the directors,
including the members of the advisory board of PLDT, is entitled to a
director&#146;s fee in the amount of Php125,000 for each meeting of the board
attended, except Manuel V. Pangilinan, who has waived his right to receive a
director&#146;s fee.  Each of the members or advisors of the audit, executive
compensation, governance and nomination and finance committees is entitled to a
fee in the amount of Php50,000 for each committee meeting attended.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">There are no agreements between PLDT Group and any of
its key management personnel providing for benefits upon termination of
employment, except for such benefits to which they may be entitled under PLDT
Group&#146;s retirement and incentive plans.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>21. Employee Benefits</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Executive Stock Option Plan, or ESOP</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On April 27, 1999 and December 10, 1999, the Board of Directors and stockholders,
respectively, approved the establishment of an ESOP and the amendment of the
Seventh Article of the Articles of Incorporation of PLDT denying the
pre-emptive right of holders of common stock to subscribe for any issue of up
to 1,289,745 common stock pursuant to the ESOP.  The ESOP covers management
executives, which include officers with rank of Vice President up to the
President, executives with the rank of Manager up to Assistant Vice President,
and advisors/consultants engaged by PLDT.  The ESOP seeks to motivate option
holders to achieve PLDT&#146;s goals, reward option holders for the creation of
shareholder value, align the option holders&#146; interests with those of the
stockholders of PLDT and retain the option holders to serve the long-term
interests of PLDT.  The ESOP is administered by the Executive Compensation
Committee of the Board of Directors.  About 1.3 million shares of common stock
of PLDT had been reserved as underlying shares of options under the ESOP in
1999.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0">Movements in the number of
stock options outstanding under the ESOP are as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.5in;margin-left:.25in;border-collapse:collapse;width:6.5in !msorm;
 border-collapse:collapse !msorm'>
 <tr style='height:2.5pt' style='height:2.5pt !msorm'>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:2.5pt'>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of
 period</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>197,500</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,589</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Exercised shares*</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(54,504)</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(335,605)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cancellations/forfeitures</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-bottom:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,484)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>142,996</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">197,500</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>*    </i><i>Based on date of
payment of exercised shares.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">As at June 30, 2006, options covering a total of 726,854 shares had been exercised
by certain officers and executives at an exercise price of Php814 per share.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
fair value of the ESOP plan was estimated at the date of grant using an option
pricing model, which considered annual stock volatility, risk-free interest
rate, expected life of option, exercise share price of Php814 and a weighted
average share price of Php870 for the 1999 Grant and of Php315 for the 2002
Grant as at valuation date.  Total fair value of shares granted amounted to
Php359 million as at June 30, 2006 and December 31, 2005.  There was no fair
value of options recognized as an expense for the six months ended June 30,
2006 and 2005.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>LTIP</i></b></p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">On August 3, 2004,
PLDT&#146;s Board of Directors approved the establishment of the LTIP for eligible
key executive officers and advisors of PLDT and its subsidiaries, which is
administered by the Executive Compensation Committee.  The LTIP is a four-year
cash plan covering the period January 1, 2004 to December 31, 2007.  The LTIP
awards payment at the end of the four-year period (without interim payments) is
contingent upon the achievement of an approved target increase in PLDT&#146;s common
share price by the end of the plan period and a cumulative consolidated net
income target for the plan period.  The target increase in the PLDT base share
price, which is the average of the closing prices of PLDT shares ten trading
days before or after December 31, 2003, is approximately 15% per annum
compounded for the plan period.</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The fair
value of the LTIP was estimated using an option pricing model, which considered
annual stock volatility, risk-free interest rate, remaining life of option and
share price Php1,830.00 as at valuation date.  Incentive cost per share as at
June 30, 2006 and December 31, 2005 amounted to Php915.95 and Php1,044.01,
respectively.  The fair value of the options recognized as an expense for the
six months ended June 30, 2006 and 2005 amounted to Php933 million and Php610
million, respectively.</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0">Movements in the number of
stock options outstanding under the LTIP are as follows:</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.5in;margin-left:.25in;border-collapse:collapse'>
 <tr style='height:2.5pt'>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:2.5pt'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:2.5pt'>
 <p align=right style='margin-top:3.0pt;margin-right:4.3pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Balance at beginning of period</p>
 </td>
 <td  valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,884,406</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,685,959</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Awards</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">493,429</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cancellations/forfeitures</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(104,212)</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(294,982)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Balance at end of period</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,780,194</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,884,406</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Pension</i></b></p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Defined Benefit Plans</i></p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We have defined benefit pension plans, covering
substantially all of our permanent and regular employees, excluding those of
Smart and its subsidiary, I-Contacts, Inc., which require contributions to be
made to separate administrative funds.</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
actuarial valuation is done on an annual basis.  Based on the latest actuarial
valuation, the actual present value of accrued liabilities, net of pension cost
and average assumptions used in developing the valuation are as follows:</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:8.0pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Benefit obligation as at December 31,2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,652</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fair value of plan assets
 as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,154</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Funded status</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,498</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unrealized net transition
 obligation</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(61)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unrecognized net actuarial
 gain</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(162)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrued benefit cost as at December 31, 2005 (Audited)</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,275</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrual of pension cost during the period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">445</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Contributions</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(45)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrued benefit cost as at June 30, 2006 (Unaudited)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,675</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Net pension cost was computed as follows:</p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:11.25pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:6.2pt' style='page-break-inside:
 avoid !msorm;height:6.2pt !msorm'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:6.2pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.2pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Components of net periodic benefit cost:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Service cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>245</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">223</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest cost</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>447</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">345</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Actual return on plan assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(270)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(238)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Amortization of unrecognized net
 transition obligation</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>23</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Net periodic benefit cost</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>445</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:double windowtext 2.25pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The unaudited weighted average assumptions used to
determine pension benefits as at June 30, 2006 are as follows:</p>

<p align=right style='margin-left:.5in;text-align:right;
text-indent:-.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Discount rate</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Rate of increase in compensation</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Expected rate of return on plan assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at June 30, 2006, the assets of the beneficial
trust fund established for the PLDT pension plan include investments in shares
of stock of PLDT and Piltel with fair values aggregating Php1,641 million,
which represent about 29% of said beneficial trust fund&#146;s net assets available
for plan benefits.</p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Board of Trustees of the beneficial trust fund
adopts an investment approach of mixed equity and fixed income investments to
maximize the long-term return of plan assets.  The investment portfolio has
been structured to achieve the objective of regular income with capital growth
and out-performance of benchmarks.  A majority of the investment portfolio consists
of fixed income debt securities and various equity securities while the
remaining portion consists of multi-currency investments.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
allocation of the fair value of the beneficial trust fund&#146;s assets for the PLDT
pension plan follows:</p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Investments in equity
 securities</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>41%</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.4pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">37%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Investments
 in debt and fixed income securities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>30%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">40%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Investments
 in real estate</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>12%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">13%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Investments
 in mutual funds</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>8%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Investments
 in temporary placements</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>9%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">4%</p>
 </td>
 </tr>
 <tr style='height:3.5pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>100%</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">100%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
expects to make approximately Php558 million of cash contributions to its
pension plan in 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK62"></a><a name="OLE_LINK61"><i>Defined
Contribution Plan</i></a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart
maintains a trustee-managed, tax-qualified, multi-employer plan covering
substantially all permanent and regular employees.  The plan has a defined
contribution format wherein Smart&#146;s obligation is limited to a specified
contribution to the plan.  It is being financed by the participating companies
(Smart and its subsidiary, I-Contacts, Inc.) and employee contribution is
optional.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
allocation of the fair value of plan assets for Smart as at June 30, 2006
(unaudited) and as at December 31, 2005 (audited) follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Investments
 in debt securities</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">71%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Investments in equity
 securities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.4pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">24%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5%</p>
 </td>
 </tr>
 <tr style='height:3.5pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">100%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Smart
expects to make approximately Php97 million of cash contributions to its
pension plan in 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Pension
Benefit Cost</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
pension benefit cost follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Six
 Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:6.2pt' style='page-break-inside:
 avoid !msorm;height:6.2pt !msorm'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm;height:6.2pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:6.2pt'>
 <p align=center style='margin-left:40.3pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Expense
 recognized for defined benefit plans</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>445</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Expense
 recognized for defined contribution plans</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>54</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>499</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">384</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>22. Contractual Obligations and Commercial
Commitments</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Contractual Obligations</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table discloses our unaudited consolidated
contractual obligations outstanding as at June 30, 2006:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.2%;margin-left:18.4pt;border-collapse:collapse'>
 <tr style='height:10.25pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Payments
 Due by Period</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Within<br>
 1 year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2</b><b>-3</b></p>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>4</b><b>-5</b></p>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>After
 5<br>
 years</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Long-term debt(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">98,367</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,449</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26,537</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,163</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">44,218</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Long-term lease obligations: </p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-align:justify' style="margin-top:0;margin-bottom:0">Operating
 lease</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,435</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">606</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,067</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">815</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">947</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-align:justify' style="margin-top:0;margin-bottom:0">Capital
 lease</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,670</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,001</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">223</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">427</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Unconditional purchase
 obligations(2)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,815</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,961</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,129</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,129</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,596</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Other long-term obligations</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">12,389</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,115</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,274</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>Total contractual
 obligations</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>126,676</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>25,017</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>35,071</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>19,400</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47,188</b></p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK19">&nbsp;</a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   Before deducting
unamortized debt discount and debt issuance costs.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(2)</i><i>   Based on the
original Air Time Purchase Agreement with AIL.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Long-term
Debt</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">For
a discussion of our long-term debt, see <i>Note 17 </i>&#150; <i>Interest-bearing
Financial Liabilities</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Operating Lease Obligations</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Digital
Passage Service Contracts.   PLDT has existing Digital Passage Service
Contracts with foreign telecommunication administrations for several dedicated
circuits to various destinations for ten to 25 years expiring at various
dates.  As at June 30, 2006, PLDT&#146;s aggregate remaining obligation under these
contracts amounted to approximately Php12 million.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>License
Agreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius.  </i>PLDT entered into a license agreement with Mobius
pursuant to which Mobius has granted PLDT a non-exclusive, non-assignable and
non-transferable license for the use of computer software components.  Under
this agreement, Mobius is also required to provide maintenance services for a
period of one year at no additional maintenance charge.  PLDT may purchase
maintenance services upon expiration of the first year for a fee of 15% of the
current published license fee.  As at June 30, 2006, PLDT&#146;s aggregate remaining
obligation under this agreement was approximately Php20 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Operating Lease Obligations</i>.
The PLDT Group has various long-term lease contracts for periods ranging from
two to ten years covering certain offices, warehouses, cell sites
telecommunication equipment locations and various office equipment.  In
particular, Smart has lease obligations aggregating Php3,171 million as at June
30, 2006 in respect of office and cell site rentals with over 3,000 lessors
nationwide, PLDT has lease obligations aggregating Php100 million as at June
30, 2006, and ePLDT has lease obligations aggregating Php132 million as at June
30, 2006 in respect of certain office space rentals.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Capital Lease Obligations</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For a discussion of our long-term capital lease
obligations, see <i>Note 17 &#150; Interest-bearing Financial Liabilities</i>.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Unconditional
Purchase Obligations</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Air
Time Purchase Agreement with AIL.  </i>As
discussed in <i>Note 20 &#150; Related Party Transactions</i>, PLDT is a party to a
Founder NSP Air Time Purchase Agreement entered into with AIL in March 1997,
which was amended in December 1998, under which PLDT was granted the exclusive
right to sell AIL services in the Philippines.  In exchange, the Air Time
Purchase Agreement required PLDT to purchase from AIL a minimum of US$5 million
worth of air time annually over ten years commencing on January 1, 2002, the
purported date of commercial operations of the Garuda I Satellite.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
the event that AIL&#146;s aggregate billing revenue is less than US$45 million in
any given year, the Air Time Purchase Agreement also states that PLDT has to
make supplemental air time purchase payments not to exceed US$15 million per
year during the ten-year term.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
and the other founder NSPs are endeavoring to amend the Air Time Purchase
Agreement due to the occurrence of partial satellite loss, changes in the
primary business of ACeS and other events affecting the business.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In March 2003, PLDT, together with the other founder
NSPs, entered into a Standstill Agreement with AIL suspending the application
and enforcement of the minimum and supplemental air time payments under the
original Air Time Purchase Agreement.  The parties agreed that AIL shall
provide PLDT and the other founder shareholders, with unlimited use of air time
for the year 2003 in exchange for a fixed fee in the amount of US$3.8 million
for PLDT.  Moreover, PLDT was also obliged to purchase from AIL 13,750
satellite phone units in 2003 at US$395 F.O.B. per unit, subject to quarterly
price adjustments.  The parties to the Standstill Agreement also agreed to
negotiate in good faith and use their best efforts to reach an agreement on a
revised Air Time Purchase Agreement before November 15, 2003 that would cover,
among other things, the amended minimum and supplemental air time payment
provisions subject to the approval of AIL&#146;s creditors.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On February 10, 2004, notwithstanding the ongoing
negotiations, AIL advised PLDT of the termination of the Standstill Agreement
and the reinstatement of the terms under the original Air Time Purchase
Agreement effective January 1, 2002 following the lapse of the November 15,
2003 deadline set in the Standstill Agreement for the negotiation of a revised
Air Time Purchase Agreement.  Negotiations are continuing with the relevant
parties towards an amicable settlement of this matter.  See <i>Note 20 &#150; Related
Party Transactions</i> and <i>Note 23 &#150; Provisions and Contingencies </i>for
further details relating to the Air Time Purchase Agreement with AIL.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at June 30, 2006, PLDT&#146;s aggregate remaining minimum obligation under the original
Air Time Purchase Agreement was approximately Php10,815 million.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Obligations</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Mandatory
Conversion and Purchase of Shares</i>.
As discussed in <i>Note 17 &#150; Interest-bearing Financial Liabilities</i>, as at June
30, 2006, PLDT had issued a total of 3 million shares of Series V Convertible
Preferred Stock, 5 million shares of Series VI Convertible Preferred Stock and
4 million shares of Series VII Convertible Preferred Stock in exchange for a
total of 58 million shares of Series K Class I Convertible Preferred Stock of
Piltel, pursuant to the debt restructuring plan of Piltel adopted in June 2001.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Each share of Series V, VI and VII Convertible
Preferred Stock is convertible at any time at the option of the holder into one
PLDT common share.  On the date immediately following the seventh anniversary
of the issue date of the Series V and Series VI Convertible Preferred Stocks
and on the eighth anniversary of the issue date of the Series VII Convertible
Preferred Stock, the remaining outstanding shares under these series will be mandatorily
converted to PLDT common shares.  Under a put option exercisable for 30 days,
holders of common shares received on mandatory conversion of the Series V, VI
and VII Convertible Preferred Stocks will be able to require PLDT to purchase
such PLDT common shares for Php1,700 per share, US$36.132 per share, and JPY4,071.89
per share, respectively.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">As at June
30, 2006, 2,668,962 shares of Series V Convertible Preferred Stock and 2,681,644
shares of Series VI Convertible Preferred Stock had been converted to PLDT
common shares.  As at June 30, 2006, 52,478 shares of Series V, 2,613,460
shares of Series VI and 3,842,000 shares of Series VII Convertible Preferred
Stocks remained outstanding.  The aggregate value of the put option based on
outstanding shares as at June 30, 2006 was Php12,389 million, of which Php5,115
million is puttable on June 4, 2008 and Php7,274 million on June 4, 2009, if
all of the outstanding shares of Series V, VI and VII Convertible Preferred
Stocks were mandatorily converted and all the underlying common shares were put
to PLDT.  The market value of the underlying shares of common stock was Php11,910
million, based on the market price of PLDT common shares of Php1,830.00 per
share as at June 30, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK16"><b><i>Commercial Commitments</i></b></a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, our outstanding commercial commitments, in the form of
letters of credit, amounted to Php1,836 million.  These commitments will expire
within one year.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style="margin-top:0;margin-bottom:0"><b>23. Provisions
and Contingencies </b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
discussed below, we currently expect that going forward we will pay local
franchise taxes on an annual basis and based on the gross receipts received or
collected for services rendered within the jurisdiction of the respective
taxing authority.  For this reason, we have made the appropriate provisions in our
unaudited consolidated financial statements as at June 30, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>NTC supervision and regulation fees, or SRF</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Since 1976, PLDT has received assessments from NTC for
permit, SRF and other charges pursuant to Section 40 of Commonwealth Act 146,
otherwise known as the Public Service Act.  As at June 30, 2006, PLDT had paid,
since 1994, a total amount of Php1,960 million in SRF, of which Php1,724
million was paid under protest.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT is contesting the manner by which these
assessments were calculated and the basis for such calculations.  The case is
now with the Supreme Court and upon the rules and practice of court, stands submitted for decision.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Smart
and Piltel have similarly received assessments from NTC for permit, SRF and
other charges which were paid under protest.  Total payments by Smart amounted
to Php122 million each in 2005 and 2004.  On February 11, 2005, based on the
NTC&#146;s deficiency recomputation, Piltel paid the amount of Php559 million in
respect of NTC fees for the period from 1992 to 2004.  On September 30, 2005,
Piltel paid SRF of Php81 million representing amounts due for 2005.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK17"><i>Local business and
franchise tax assessments</i></a></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT is presently a party to several cases involving
the issue of exemption of PLDT from local franchise and business taxes.  PLDT
believes, based on the opinion of its legal counsel, that it is exempt from
payment of local franchise and business taxes. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The Local
Government Code of 1991, or R.A. No. 7160, which took effect on January 1, 1992, extended to local government units, or LGUs, power to tax businesses
within their territorial jurisdiction granted under Batas Pambansa No. 337 and
withdrew tax exemptions previously granted to franchise grantees under Section
12 of R.A. No. 7082. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT
believes, based on the opinion of its legal counsel, that R.A. No. 7925 which
took effect on March 16, 1995, and the grant of local franchise and business
taxes exemption privileges to other franchise holders subsequent to the
effectivity of R.A. No. 7160, implicitly restored its local franchise and
business taxes exemption privilege under Section 12 of R.A. No. 7082, or the
PLDT Franchise pursuant to Section 23 thereof or the quality of treatment
clause. </p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">To confirm this position, PLDT sought and obtained on June 2, 1998 a ruling from the Bureau of Local Government Finance, or BLGF, of the
Philippine Department of Finance, which ruled that PLDT is exempt from the
payment of local franchise and business taxes imposable by LGUs under R.A. No.
7160.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">By virtue
of the BLGF Ruling, PLDT stopped paying local franchise and business taxes
starting with the fourth quarter of 1998 and has filed with certain LGUs claims
for tax refund covering the period from the second quarter of 1995 to the third
quarter of 1998.  PLDT has received assessments for local franchise and
business taxes from several cities and provinces following PLDT&#146;s decision to
stop payment of local franchise and business taxes.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Following
a decision of the Supreme Court on March 25, 2003, a judgment in the amount of Php4 million against PLDT involving the City of Davao became final and
executory on April 9, 2003, pursuant to which PLDT was declared not exempt from
the local franchise tax.  Pursuant to the said decision, PLDT has voluntarily
paid the total amount of Php15 million for the period from the fourth quarter
of 1998 until December 31, 2003, which includes the Php4 million subject of the
case.  The said amount constitutes only the basic franchise tax due for the
said period, excluding surcharges and interest  which PLDT is asking the City
of Davao, through the local council, to waive.  PLDT believes, based on the
opinion of its legal counsel, that PLDT is not liable for surcharges and
interest considering that the legal issue involved was a difficult one and
PLDT&#146;s non-payment of the said taxes was made in good faith.  On August 2, 2005, the local Sanggunian passed a resolution denying PLDT&#146;s request for
abatement of surcharges and penalties and directing the city treasurer to
update PLDT&#146;s liability and immediately collect the same.  Accordingly, on August 26, 2005, the city treasurer issued an assessment to PLDT in the amount of Php12
million.  In order to maintain and preserve its good standing and relationship
with the City of Davao, PLDT has paid the surcharges and penalties as at December 31, 2005.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK37">Although PLDT believes that it is not liable to pay local
franchise and business taxes, PLDT has entered into compromise settlements with
several LGUs, including the City of </a>Makati, in order to maintain and
preserve its good standing and relationship with these LGUs.  Under these
compromise settlements, which have mostly been approved by the relevant courts,
PLDT has paid a total amount of Php565 million for local franchise tax covering
prior periods up to the end of 2005 as at June 30, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT no
longer had contested assessments from LGUs for franchise taxes as at June 30,
2006.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT
currently expects that going forward it will pay local franchise and business
taxes on an annual basis and based on the gross receipts received or collected
for services rendered within the jurisdiction of the respective taxing
authority.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart has,
likewise, received assessments for local franchise and business taxes from
certain cities and provinces in the aggregate amount of Php313 million, which
Smart continues to contest.  Smart believes, based on the opinion of its legal
counsel, that Smart is not liable to pay the local franchise and business taxes
by virtue of (i) the opinion issued by the BLGF dated August 13, 1998; and (ii)
Smart&#146;s exemption under its legislative franchise which took effect after the
effective date of R.A. No. 7160.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK63">Smart has recently been declared exempt from payment of local
franchise tax to the City of </a>Makati in a decision dated August 3, 2004 by
the Regional Trial Court of Makati.  The City of Makati has filed a Motion for
Extension to file a Petition for Review with the Court of Appeals.  However, on
June 9, 2005, the Court of Appeals dismissed the appeal filed by the City of Makati.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The RTC of
Iloilo has likewise ruled in a decision dated January 19, 2005 that Smart is
exempt from payment of local franchise tax to the City of Iloilo.  The City of Iloilo has filed an appeal directly with the Supreme Court which remains pending.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Piltel&#146;s
Bureau of Internal Revenue, or BIR, Assessment</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">Piltel received the
following assessment notices from the BIR:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0"><b>Tax
 Assessment Type</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Basic</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Interest</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:40.55pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">1998</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">85.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">68.7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"> 154.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Overseas
 Communications Tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">31.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">25.5</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  57.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12.4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9.4</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  21.8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Administrative
 Penalties</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">0.1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">   0.1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">1999</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">94.5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">67.8</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"> 162.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">22.7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">13.8</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  36.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">2001</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">56.2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">35.1</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  91.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">13.4</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8.9</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  22.3</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">On December 12, 2005, Piltel filed a collective application for a
compromise settlement with the BIR for the deficiency tax assessments arising
from taxable years 1998, 1999 and 2001, citing &#147;reasonable doubt as to the
validity of the tax assessments&#148; as a basis.  The prescribed minimum percentage
of compromise settlement for such basis is 40% of the basic assessed tax.</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">On January 27, 2006, Piltel received the favorable recommendation and
approval from the BIR on the said application for a compromise settlement. On
January 31, 2006, Piltel settled the total amount of Php114 million, which is
equivalent to 40% of the basic taxes per final assessment notices received, to
effect the immediate cancellation of the tax assessments.  On February 24,
2006, the BIR accepted Piltel&#146;s application for compromise settlement of income
tax and VAT for the years 1998 and 1999 and income taxes and VAT for the year
2001, and accordingly, issued a certificate of availment on the said date.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Enhanced Voluntary Assessment Program, or EVAP,
Availment</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In 2005, the BIR launched a program called EVAP, which
grants taxpayers, who availed of the program, the privilege of last priority in
audit.  The program covers all types of internal revenue taxes which can be
availed of on a per tax type basis and required the payment of a certain
percentage increase in the said tax compared with the base year or the
established fixed minimum EVAP payment, whichever is higher.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
availed of the program and paid a total of Php6 million for VAT and income tax
for taxable year 2004 and VAT and withholding tax for taxable year 2002.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">On
the other hand, Maratel availed of the EVAP for income tax for the taxable year
2004, Subic Telecom availed of the program for its income tax, withholding tax
and percentage tax for taxable year 2002, while Clark Telecom availed of the
program for its income tax for both taxable years 2003 and 2004.  The total
payment of Maratel, Subic Telecom and Clark Telecom amounted to Php800,000.  Smart&#146;s
EVAP availment, for which Php53 million was paid, covered the income tax for
the taxable years 2003 and 2004, the VAT for the taxable year 2002, the
overseas communications tax for the year 2002, and the withholding taxes for
the taxable years 2002 to 2004.  Meanwhile, Piltel&#146;s EVAP availment, which
involved payment of Php3 million, covered the income tax for the taxable year
2003 and the expanded withholding tax for the taxable years 2003 and 2004.  Both
companies still await the issuance of an EVAP certificate of qualification from
the BIR.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
and these subsidiaries are awaiting for the EVAP Certificate of Qualification
to be issued by the BIR.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Smart&#146;s
EVAP availment, for which Php53 million was paid, covered the income tax for
the taxable years 2003 and 2004, the VAT for the taxable year 2002, the
overseas communications tax for the year 2002, and the withholding taxes for
the taxable years 2002 to 2004, while Piltel&#146;s EVAP availment, which involved
payment of Php3 million, covered the income tax for the taxable year 2003 and
the expanded withholding tax for the taxable years 2003 and 2004.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Air
Time Purchase Agreement with AIL</i></p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">In
March 1997, PLDT entered into a Founder NSP Air Time Purchase Agreement with PT
Asia Cellular Satellite as amended in December 1998 and as assigned and transferred
to AIL, under which PLDT was granted the exclusive right to sell ACeS services
in the Philippines.  The Air Time Purchase Agreement required PLDT to purchase
from PT Asia Cellular Satellite at least US$5 million worth of air time
annually over ten years, commencing on January 1, 2002, the purported date of the
start of commercial operations, and to make supplemental air time purchase
payments not to exceed US$15 million per year during the ten-year term in the
event revenues generated are less than US$45 million in any given year.  Under
the Air Time Purchase Agreement, the air time payment obligations remain in
effect until all indebtedness incurred by AIL has been fully repaid.  See <i>Note
20 &#150; Related Party Transactions</i> and <br>
<i>Note 22 &#150; Contractual Obligations and Commercial Commitments</i> for
detailed discussion of the terms of the agreement.</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">PLDT and the other founder NSPs are endeavoring to amend the Air Time
Purchase Agreement due to the occurrence of partial satellite loss, changes in
the primary business of ACeS and other events affecting the business.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">In March
2003, PLDT, together with the other founder NSPs, entered into a Standstill
Agreement with AIL.  Payments made to AIL under the Air Time Purchase Agreement
based on billings of actual usage and the Standstill Agreement amounted to US$2
million and US$1 million for the second quarters of 2005 and 2004,
respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On
February 10, 2004, notwithstanding the ongoing negotiations, AIL advised PLDT
of the termination of the Standstill Agreement and the reinstatement of the
terms under the original Air Time Purchase Agreement effective January 1, 2002
following the lapse of the November 15, 2003 deadline set in the Standstill
Agreement for the negotiation of a revised Air Time Purchase Agreement.  As at
June 30, 2006, PLDT&#146;s outstanding payables under the original Air Time Purchase
Agreement were approximately Php4,096 million.  Negotiations are continuing
with the relevant parties towards an amicable settlement of this matter.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On June
21, 2004, AIL also sent PLDT a letter citing PLDT in default under the Air Time
Purchase Agreement for non-payment of outstanding amounts and for repudiation
of its obligations thereunder.  PLDT maintains, however, that the termination
of the Standstill Agreement and reinstatement of the terms under the original
Air Time Purchase Agreement are premature, considering that the discussions or
negotiations on the terms of the proposed revised Air Time Purchase Agreement
were still pending between the parties, such that it is highly inequitable for
AIL to have unilaterally decided to invoke the provisions of the Standstill
Agreement and declared PLDT in default.  Furthermore, PLDT maintains <br>
its position that the Air Time Purchase Agreement has been rendered ineffective
by various events, circumstances and technical problems encountered in the
operation of the business of AIL.  The substantial changes in the circumstances
under which AIL must operate, changes which were not contemplated by the
parties at the time the commitments were made, have rendered the commitments
under the Air Time Purchase Agreement unrealistic and the performance of the
same impossible.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">As
at June 30, 2006, PLDT&#146;s aggregate remaining minimum obligation under the
original Air Time Purchase Agreement was approximately Php10,815 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">We
made a reasonable estimate of the amount necessary in the event such obligation
would be settled and have made the appropriate provisions in our unaudited consolidated
financial statements as at June 30, 2006 with due consideration of AIL&#146;s
existing indebtedness and of PLDT&#146;s share as one of the founder NSPs.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK25">&nbsp;</a></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK11">&nbsp;</a></p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>24. Financial Assets and Liabilities</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
financial assets and liabilities are recognized initially at fair value.
Transaction costs (debt issuance costs) are included in the initial measurement
of all financial assets and liabilities except those classified as financial
instruments measured at fair value through profit and loss.  Subsequent to
initial recognition, assets and liabilities are either valued at amortized cost
using the effective interest rate method or at fair value depending on
classification.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following table sets forth the carrying values and estimated fair values of our
financial assets and liabilities recognized as at June 30, 2006 and December
31, 2005.  There are no material unrecognized financial assets and liabilities
as at June 30, 2006 and December 31, 2005.</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:97.22%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:15.35pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:15.35pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=center style='margin-left:40.55pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Carrying
 Value</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=center style='margin-left:40.55pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Fair
 Value</b></p>
 </td>
 </tr>
 <tr style='height:15.35pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.35pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=right style='margin-right:3.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30,<br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=right style='margin-right:3.9pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=right style='margin-right:3.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30,<br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:15.35pt'>
 <p align=right style='margin-right:3.9pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31 , 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:11.5pt'>
 <p align=center style='margin-left:45.05pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='height:11.25pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Investments-available-for-sale</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>111</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>111</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,081</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,081</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='height:11.7pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.7pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Notes receivable</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>346</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>346</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='height:8.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total noncurrent financial
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,538</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,103</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,538</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">3,103</p>
 </td>
 </tr>
 <tr style='height:9.85pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.85pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.7pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>25,966</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">30,064</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>25,966</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">30,064</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term investments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,172</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,746</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,172</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,746</p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,844</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7,113</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,844</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">7,113</p>
 </td>
 </tr>
 <tr style='height:8.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='height:8.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total current financial assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>36,997</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">39,960</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>36,997</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">39,960</p>
 </td>
 </tr>
 <tr style='height:10.75pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>Total Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>38,535</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">43,063</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>38,535</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">43,063</p>
 </td>
 </tr>
 <tr style='height:6.6pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.6pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term debt - net of current
 portion*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>72,410</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">84,860</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>77,963</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">92,811</p>
 </td>
 </tr>
 <tr style='height:4.5pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Obligations under capital lease*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>269</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">381</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>269</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.5pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">381</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Preferred
 stock subject to mandatory redemption*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,854</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">11,974</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,054</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.45pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">14,053</p>
 </td>
 </tr>
 <tr style='height:5.85pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,918</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,918</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:5.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='height:7.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total noncurrent financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>88,451</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">102,992</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>95,204</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">113,022</p>
 </td>
 </tr>
 <tr style='height:4.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:4.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:4.95pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,295</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15,482</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,295</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">15,482</p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>66</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>66</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Current portion of long-term
 debt*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>18,281</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">18,684</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>19,679</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">19,435</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Obligations under capital lease*</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>828</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">717</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>828</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">717</p>
 </td>
 </tr>
 <tr style='height:9.85pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.85pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total current financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>30,470</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">35,075</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>31,868</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.85pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">35,826</p>
 </td>
 </tr>
 <tr style='height:6.25pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.25pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0"><b>Total Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>118,921</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">138,067</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>127,072</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.25pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">148,848</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">*    <i>Included under &#147;Interest-bearing Financial Liabilities&#148;
in the consolidated balance sheets.</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following methods and assumptions were used to estimate the fair value of each
class of financial instrument for which it is practicable to estimate such
value:</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest-bearing Financial Liabilities:</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term debt:</i>
Fair value is based on the following:</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=1 cellspacing=0 cellpadding=0
 style='width:96.2%;margin-left:18.4pt;border-collapse:collapse;border:none'>
 <tr>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Debt Type</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Fair Value Assumptions</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed
 Rate Loans:</p>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S.
 dollar notes/convertible debt</p>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other
 loans in all other currencies</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Quoted
 market price.</p>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Estimated
 fair value is based on the discounted value of future cash flows using the applicable
 LIBOR and MART1 rates for similar types of loans.</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Variable
 Rate Loans</p>
 </td>
 <td   valign=top style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
 carrying value approximates fair value because of recent and regular
 repricing based on market conditions.</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Preferred
stock subject to mandatory redemption:</i>
The fair values were determined using a stock option valuation model.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Derivative instruments:</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Forward foreign exchange contracts and bifurcated
foreign currency forwards:</i> The fair
values were determined using forward exchange market rates at the balance sheet
date.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Foreign
currency options:</i>  The fair values
were computed using an option pricing model.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Foreign
currency and interest rate swaps:</i>  The fair values were computed as the
present value of estimated future cash flows.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Bifurcated equity </i><i>call</i><i> options:</i>  The fair values were computed using an
option pricing model.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Due to the
short-term nature of the transactions, the fair value of cash and cash
equivalents, short-term investments, trade and other receivables, notes payable
and accounts payable approximate the carrying amounts as of the balance sheet
date.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Financial
assets and liabilities carried at amortized cost</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Unamortized
debt discount, representing debt issuance cost and any difference between the
fair value of consideration given or received on initial recognition, included
in following financial liabilities amounted to Php10,784 million and Php13,347
million as at June 30, 2006 and December 31, 2005, respectively, see <i>Note 17
&#150; Interest-bearing Financial Liabilities</i>.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Financial
assets and liabilities carried at fair value</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following financial assets and liabilities were carried at fair value as at June
30, 2006 and December 31, 2005.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:0in;margin-bottom:.0001pt;punctuation-wrap:hanging;
 text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>June
 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million
 pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Investments-available-for-sale</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>111</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Derivative instruments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,888)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,284)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,777)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,175)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Derivative Financial Instruments</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Our
derivative financial instruments are accounted for as either cash flow hedges
or transactions not designated as hedges.  Cash flow hedges refer to those
transactions that hedge our exposure to variability in cash flows attributable
to a particular risk associated with a recognized asset or liability. Changes
in the fair value of these instruments representing effective hedges are
recognized as cumulative translation adjustments in equity until the hedged
item is recognized in earnings.  For transactions that are not designated as
hedges, any gains or losses arising from the changes in fair value are
recognized directly to income for the period.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The table
below sets out the information about our derivative financial instruments as at
June 30, 2006 and December 31, 2005:</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>June
 30, 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">December
 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:9.35pt;
 margin-bottom:0in;margin-left:.2pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Maturity</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Notional</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Mark-to-market
 Gain (Loss)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0">Notional</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0">Mark-to-market
 Gain (Loss)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b><i>PLDT</i></b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cash flow hedges:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term currency swaps</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:20.9pt;
 margin-bottom:0in;margin-left:5.05pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">2017</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$300</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php934)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$300</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php417</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-top:0in;margin-right:20.9pt;
 margin-bottom:0in;margin-left:5.05pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">2012</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>250</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,309)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">250</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(428)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term foreign currency
 options</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>175</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(609)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Transactions not designated
 as hedges:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term foreign currency
 options</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>175</b>(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>185</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">175(1)</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(270)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term currency options</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JPY1,516</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(17)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY151</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest rate swap</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$63</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(968)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$125</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,569)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Forward foreign exchange
 contracts</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$158</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(8)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">220</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(169)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JPY1,516</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY1,282</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Bifurcated equity call options</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6
 shares</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,215)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">8
 shares</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,597)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php4,881)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(Php3,310)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b><i>Smart</i></b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Transactions not designated as hedges:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Bifurcated embedded derivatives</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$16</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(7)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Net liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php4,888</b><b>)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(Php3,284)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:31.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   Non-hedged
portion of 2009 long-term foreign currency options based on the same notional
amount as the hedged portion.</i></p>

<p style='margin-left:31.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Presented
 as:</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Noncurrent
 assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,081</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current
 assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Noncurrent
 liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,918)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5,777)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current
 liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(66)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(192)</p>
 </td>
 </tr>
 <tr style='height:3.5pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(4,888)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,284)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all style='page-break-before:always'>

<p style="margin-top:0;margin-bottom:0">Cumulative
translation adjustments as at June 30, 2006 and December 31, 2005 consists of:</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.94%;margin-left:18.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, <br>
 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:31.65pt;text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Cumulative translation
 adjustments at beginning of period</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,253</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">362</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Movements of cumulative
 translation adjustments:</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Deferred income tax effects on
 cash flow hedges</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>983</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(427)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Currency translation differences</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(62)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Net gain on available-for-sale
 financial assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net gain on
 cash flow hedges removed from cumulative translation adjustments and taken to
 profit or loss</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(115)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,390</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Net loss on cash flow hedges</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,133)</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,014)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(2,259)</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 891</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cumulative translation adjustments
 at end of period</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,006)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,253</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Analysis of gain on derivative transactions for the
six months ended June 30, 2006 and 2005 are as follows:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:3.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:3.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Six Months Ended June 30,</b></p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.45pt'>
 <p align=center style='margin-left:31.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.45pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:.65in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Unaudited)</p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.45pt'>
 <p align=center style='margin-left:40.3pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 mark-to-market loss at end of period</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>(4,888)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(2,519)</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.35pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 mark-to-market loss at beginning of period</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>(3,284)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(2,964)</p>
 </td>
 </tr>

 <tr style='height:7.6pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 change</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,604)</b> </p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 445</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net loss
 charged to cumulative translation adjustments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,133</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">867</p>
 </td>
 </tr>
 <tr style='height:6.75pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Settlements,
 accretion and conversion</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,552)</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(534)</p>
 </td>
 </tr>
 <tr style='height:7.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net gain
 (loss) on derivative transactions</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(23)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 778</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>PLDT</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>Cash
Flow Hedges</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Long-term
Currency Swaps</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT
entered into long-term principal-only currency swap agreements with various
foreign counterparties to hedge the currency risk on its fixed rate notes
maturing in 2009, 2012 and 2017.  As at June 30, 2006 and December 31, 2005,
these long-term currency swaps have an aggregate notional amount of US$550
million.  Under the swaps, PLDT effectively exchanges the principal of its U.S.
dollar-denominated fixed rate notes into peso-denominated loan exposures at
agreed swap exchange rates.  The agreed swap exchange rates are reset to the
lowest U.S. dollar/Philippine peso spot exchange rate during the term of the
swaps, subject to a minimum exchange rate.  In March and April 2004, PLDT
entered into amendments to keep the lowest reset exchange rate and unwind the
downward resettable feature of US$550 million of its long-term principal-only
currency swap agreements in order to lower the running hedging cost of the
swaps.  As at June 30, 2006 and December 31, 2005, the outstanding swap
contracts have an agreed average swap exchange rate of Php50.76.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">In order
to manage hedge costs, these swaps included a credit-linkage feature with PLDT
as the reference entity.  The specified credit events include bankruptcy, failure
to pay, obligation acceleration, moratorium/repudiation, and restructuring of
PLDT bonds or all or substantially all of PLDT&#146;s obligations.  Upon the
occurrence of any of these credit events, subject to agreed threshold amounts
where applicable, the obligations to both PLDT and its counterparty under the
swap contracts terminate without further settlements to either party, including
any mark-to-market value of the swaps.  As at June 30, 2006 and December 31,
2005, US$725 million of PLDT&#146;s long-term currency swaps/options have been
structured to include credit-linkage with PLDT as the reference entity.  The
semi-annual fixed or floating swap cost payments that PLDT is required to make
to its counterparties averaged about 5.30% and 4.50% per annum as at June 30,
2006 and December 31, 2005, respectively.  As cash flow hedges, any movements
in the fair value of these instruments will be taken as a cumulative
translation adjustment under equity in our consolidated balance sheets.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Long-term
Foreign Currency Options</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">To manage
hedging costs, the currency swap agreement relating to the 2009 fixed rate
notes has been structured to include currency option contracts.  If the
Philippine peso to U.S. dollar spot exchange rate on maturity date settles
beyond Php90.00 to US$1.00, PLDT will have to purchase U.S. dollar at an
exchange rate of Php52.50 to US$1.00 plus the excess above the agreed threshold
rate.  On the other hand, if on maturity, the Philippine peso to US$1.00 spot
exchange rate is lower than the exchange rate of Php52.50 to US$1.00, PLDT will
have the option to purchase at the prevailing Philippine peso to U.S. dollar
spot exchange rate.  In July 2004, PLDT and its counterparty, agreed to
re-document and re-classify the transaction into long-term currency option
contracts.  The net semi-annual floating hedge cost payments that PLDT is
required to pay under these transactions was approximately 6.53% and 5.68% per
annum as at June 30, 2006 and December 31, 2005, respectively.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The option
currency contract relating to PLDT&#146;s option to purchase U.S. dollar at Php52.50
to US$1.00 or prevailing spot rate at maturity, whichever is lower, qualifies
as a cash flow hedge.  The option currency contract relating to the
counterparty&#146;s option to purchase foreign currency from PLDT at Php90.00 to
US$1.00 is not designated as a hedge.  Please refer to discussion below (under
transactions not designated as hedges).</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Transactions Not Designated as Hedges</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Due to the amounts of PLDT&#146;s foreign currency hedging
requirements and the large interest differential between the Philippine peso
and the U.S. dollar, the costs to book long-term hedges can be significant.  In
order to manage such hedging costs, PLDT utilizes structures that include
currency option contracts, and fixed-to-floating coupon-only swaps that may not
qualify for hedge accounting. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Long-term
Foreign Currency Options</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">With
reference to the above-mentioned hedge on PLDT&#146;s 2009 fixed rate notes, PLDT
simultaneously sold a currency option contract with the same notional amount of
US$175 million with the same maturity that gives the counterparty a right to
purchase foreign currency at Php90.00 to US$1.00.  Together with the long-term
currency option contract classified under cash flow hedges, PLDT has the
obligation to purchase U.S. dollars at an exchange rate of Php52.50 to US$1.00
plus the excess above the agreed threshold rate.  In exchange for this
condition, the overall net hedging cost for the transaction is reduced.</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Short-term
Currency Options</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
entered into short-term U.S. dollar subsidized forward contracts to partially
hedge PLDT&#146;s fixed rate notes due June 2006.  In order to reduce overall net
hedging cost for the transactions, these forward contracts have been structured
to include the sale of currency call option contracts that give the
counterparty the right to purchase foreign currency at an agreed exchange rate.
 PLDT effectively has the obligation to buy U.S. dollars at a subsidized
forward rate plus any excess above the agreed threshold rate should the
Philippine peso to U.S. dollars spot exchange rate on the maturity date settle
beyond that agreed threshold.  PLDT&#146;s subsidized forward contracts amounting to
US$62 million matured on June 29, 2006.  As at June 30, 2006, there are no outstanding
subsidized forward contracts.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">PLDT
also entered into short-term Japanese yen currency option contracts to hedge
our other short-term foreign currency obligations.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK27"><i>Interest Rate Swap</i></a></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">A portion
of PLDT&#146;s currency swap agreements to hedge its 2017 fixed rate notes carry
fixed rate swap cost payments.  To effectively lower the running cost of such
swap agreements, PLDT, in April 2003, entered into an agreement to swap the
coupon on US$125 million of its 2012 fixed rate notes into a floating rate
Japanese yen amount.  Under this agreement, PLDT is entitled to receive a fixed
coupon rate of 11.375%, provided the Japanese yen to U.S. dollar exchange rate
stays above JP&yen;99.90/US$1.00.  Below this level, a reduced fixed coupon rate of
3% will be due to PLDT.  In order to mitigate the risk of the Japanese yen
strengthening below the agreed threshold, PLDT, in December 2003, entered into
an overlay swap transaction to effectively lower the portion of the coupon
indexed to the U.S. dollar to Japanese yen rate to 3% such that the fixed
coupon rate due to PLDT when the JPY strengthens below the agreed
threshold will be 8.375%.  Both swap agreements include a credit-linkage
feature with PLDT as the reference entity.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-autospace:none' style="margin-top:0;margin-bottom:0">In March 2006, the interest rate and overlay swap
agreements were partially terminated to effectively lower the outstanding
interest rate swap notional amount to US$62.5 million.  Since changes in fair
values have already been recognized as profit and loss in prior periods, the
corresponding liability settled by PLDT amounted to Php804 million. </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Forward
Foreign Exchange Contracts</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">PLDT
entered into short-term U.S. dollar and Japanese yen forward foreign exchange
contracts to hedge short-term foreign currency obligations.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Bifurcated
Embedded Derivatives</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Derivative
instruments include derivatives (or derivative-like provisions) embedded in
non-derivative contracts.  PLDT&#146;s outstanding bifurcated embedded derivative
transactions as at December 31, 2004 covered service contracts denominated in
U.S. dollars paid out to a Japanese company in April 2005.  There are no
outstanding bifurcated embedded derivative transactions as at June 30, 2006.</p>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p style='margin-left:27.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Bifurcated
Equity Call Options</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Pursuant
to Piltel&#146;s debt restructuring plan, PLDT issued its Series VI and VII
Convertible Preferred Stock, see <i>Note 17 &#150; Interest-bearing Financial
Liabilities</i>.  Each share of Series VI and VII Convertible Preferred Stock
is convertible at any time at the option of the holder into one share of PLDT&#146;s
common stock.  On the date immediately following the seventh anniversary of the
issue date of the Series VI Convertible Preferred Stock and on the eighth
anniversary of the issue date of the Series VII Convertible Preferred Stock,
the remaining outstanding shares under these series will be mandatorily converted
into shares of PLDT common stock.  For 30 days thereafter, the holders of these
mandatorily converted shares of common stock have the option to sell such
shares of common stock back to PLDT for US$36.132 per share and JPY4,071.89
per share for Series VI and VII, respectively.  As at June 30, 2006 and
December 31, 2005, the net negative mark-to-market value of these embedded call
options amounted to Php1,215 million and Php1,597 million, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK52"></a><a
name="OLE_LINK51"><b><i>Smart</i></b></a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart&#146;s embedded
derivatives were also bifurcated from prepaid forwards.  As at June 30, 2006
and December 31, 2005, outstanding contracts included service contracts with
various contractors and suppliers covering handset importations payable in U.S.
dollars.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Smart&#146;s
other embedded derivatives were bifurcated from service and purchase
contracts.  As at June 30, 2006 and December 31, 2005, outstanding contracts
included a service contract with foreign equipment suppliers and various
suppliers covering handset importations payable in U.S. dollars.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Financial Risk Management Objectives and Policies</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The main
purpose of our financial instruments is to fund our operations.  We also enter
into derivative transactions, the purpose of which is to manage the currency
risks and interest rate risks arising from our operations and our sources of
financing.  It is, and has been throughout the year under review, our policy
that no trading in financial instruments shall be undertaken.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">The
main risks arising from our financial instruments are liquidity risk, foreign
exchange risk, interest rate risk and credit risk.  Our Board reviews and
approves policies for managing each of these risks. These risks are summarized
below.  We also monitor the market price risk arising from all financial
instruments.  Our accounting policies in relation to derivatives are set out in
<i>Note 2 &#150; Summary of Significant Accounting Policies and Practices</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Liquidity
Risk</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">We seek to
manage our liquidity profile to be able to finance our capital expenditures and
service our maturing debts.  To cover our financing requirements, we intend to
use internally generated funds and proceeds from debt and equity issues and
sales of certain assets. </p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">As part of
our liquidity risk management program, we regularly evaluate our projected and
actual cash flow information and continuously assess conditions in the
financial markets for opportunities to pursue fund-raising initiatives.  These
initiatives may include bank loans, export credit agency-guaranteed facilities,
and debt capital and equity market issues.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<b><i><br
clear=all style='page-break-before:always'>
</i></b>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Foreign Exchange Risk</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our consolidated foreign
currency-denominated monetary assets and liabilities and their peso equivalents
as at June 30, 2006 and December 31, 2005:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.2%;margin-left:18.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>June 30, 2006<br>
 (Unaudited)</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2005<br>
 (Audited)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:20.2pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:20.2pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:20.2pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>U.S. Dollar</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:20.2pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Php Equivalent</b>(1)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:20.2pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:20.2pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Php Equivalent(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:11.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='height:11.7pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$20</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php1,081</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$50</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,648</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Notes receivable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>346</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total noncurrent financial
 assets</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>  26</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,427</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  56</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,994</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>252</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>13,413</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">248</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">13,160</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term investments</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>51</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,702</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,731</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>264</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>14,062</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,371</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total current financial assets</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 567</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>30,1</b><b>92</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 439</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,299</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>Total Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>593</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php31,619</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$495</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php26,293</p>
 </td>
 </tr>
 <tr style='height:12.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:17.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Interest-bearing
 financial liabilities &#150; net of current portion</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$1,526</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php81,196</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$1,809</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php95,953</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>111</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,918</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='height:9.4pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.4pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total noncurrent financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,637</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>87,114</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,918</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">101,730</p>
 </td>
 </tr>
 <tr style='height:11.65pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.65pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>55</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,902</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,227</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accrued expenses and other
 current liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>59</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,151</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,587</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative liabilities</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>66</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Current portion of
 interest-bearing financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>328</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>17,459</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">319</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,946</p>
 </td>
 </tr>
 <tr style='height:11.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total current financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 443</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>23,578</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 432</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">22,952</p>
 </td>
 </tr>
 <tr style='height:13.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0"><b>Total Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>2,080</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php110,692</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,350</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php124,682</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   The exchange
rate used was Php</i><i>53.220 to US$1.00.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(2)     </i><i>The exchange
rate used was Php53.062 to US$1.00.</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">In
translating the foreign currency-denominated monetary assets and liabilities
into peso amounts, the exchange rates used were Php53.220 to US$1.00 and Php53.062
to US$1.00, the Philippine peso-U.S. dollar exchange rates as at June 30, 2006
and December 31, 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">As at August
7, 2006, the peso-dollar exchange rate was Php51.383 to US$1.00.  Using this
exchange rate, our consolidated net foreign currency-denominated liabilities as
at June 30, 2006 would have decreased by Php2,732.</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">While a
certain percentage of our revenues is either linked to or denominated in U.S.
dollars, substantially all of our indebtedness and related interest expense, a
substantial portion of our capital expenditures and a portion of our operating
expenses are denominated in foreign currencies, mostly in U.S. dollars.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK60"></a><a
name="OLE_LINK59">As at June 30, 2006, approximately
98% of our total consolidated debts were denominated in foreign currencies
principally in U.S. dollars.  Of our foreign currency-denominated debts, 3% are
in Japanese yen on a consolidated basis and the balance in U.S. dollars.  Thus,
a weakening of the Philippine peso against the U.S. dollar or Japanese yen will
increase both the principal amount of our unhedged foreign currency-denominated
debts (representing 50% of our consolidated debts, or 35% net of our U.S.
dollar cash balances as at June 30, 2006), and interest expense on our debt in
Philippine peso terms.  In addition, many of our financial ratios and other
financial tests will be negatively affected.  If, among other things, the value
of the Philippine peso against the U.S. dollar substantially drops from its
current level, we may be unable to maintain compliance with these ratios, which
could result in acceleration of some or all of our indebtedness.  For further
information on our loan covenants, see <i>Note 17 &#150; Interest-bearing Financial
Liabilities</i>.</a></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">To manage
our foreign exchange risks, stabilize cash flows, and improve investment and
cash flow planning, we enter into forward foreign exchange contracts, foreign
currency swap contracts, currency option contracts and other hedging products
aimed at reducing and/or managing the adverse impact of changes in foreign
exchange rates on our operating results and cash flows.  However, these hedges
do not cover all of our exposure to foreign exchange risks.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Specifically,
we use forward foreign exchange contracts, foreign currency swap contracts and
currency option contracts to manage the foreign exchange risk associated with
our foreign currency-denominated loans.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Interest
Rate Risk</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">On a
limited basis, we enter into interest rate swap agreements in order to manage
our exposure to interest rate fluctuations.  We make use of hedging instruments
and structures solely for reducing or managing financial risks associated with
our liabilities and not for trading or speculative purposes.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">The
following tables set out the carrying amount, by maturity, of our financial
instruments that are exposed to interest rate risk:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>Six
Months Ended June 30, 2006 (Unaudited)</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:103.52%;;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Discount/</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Debt</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 rowspan=2 valign=bottom style='
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>Over 5 </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>In U.S. </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Issuance Cost</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Carrying Value</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:
 7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Fair Value</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>In U.S.</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Below 1 year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1-2 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>2 &#150; 3 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>3-5 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Liabilities:</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Long-term Debt</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Fixed
 Rate</i></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">US$
 Notes (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">550</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 854</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">45,470</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">632</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">44,838</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">934</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49,718</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest
 rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">7.85% to <br>
 10.625%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">10.50%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">8.35% to 11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">US$
 Fixed Loans (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">280</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 466</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">24,817</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">6,093</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">18,724</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">370</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">19,657</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 7.75%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 7.58%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 6.66%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 4.52%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">2.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Japanese
 Yen (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">  49</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,593</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,593</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2,595</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Philippine
 Peso (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">  30</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,580</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,578</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">33</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,765</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">12.83% to 15.816%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">15%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Variable
 Rate</i></p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">U.S.
 Dollar (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">118</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">72</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">121</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 444</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">23,606</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">896</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">22,710</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">444</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">23,606</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 3.25% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 2.50% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">0.05% to 2.50% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">0.05% to 2.50% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Japanese
 Yen (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">   5</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 248</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill rate; 90-day PHIBOR + 3%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1,848</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>98,367</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>7,676</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>90,691</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1,835</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>97,642</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Interest
 rate swap (fixed to floating)</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">U.S. Dollar (US$63 million)</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(968)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(968)</p>
 </td>
 </tr>
 <tr>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Japanese Yen (JPY7,519 million)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Fixed Rate on US$ notional </p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Variable Rate on JPY notional</p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>Year
Ended December 31, 2005 (Audited)</b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:103.52%;;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Discount/</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Debt</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 rowspan=2 valign=bottom style='
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>Over 5 </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>In U.S. </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Issuance Cost</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Carrying Value</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:
 7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Fair Value</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>In U.S.</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Below 1 year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1-2 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>2 &#150; 3 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>3-5 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Liabilities:</b></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Long-term Debt</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Fixed
 Rate</i></p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">US$
 Notes (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">160</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">550</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,000</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">53,040</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">686</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">52,354</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,108</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">58,780</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest
 rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">7.85% to 10.625%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">10.50%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right' style="margin-top:0;margin-bottom:0">8.35% and 11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">US$
 Fixed Loans (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">280</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 442</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">23,451</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">6,356</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">17,095</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">327</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">17,350</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 7.75%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 7.58%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">4. 49% to 7.58%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">4.49% to 5.65%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">2.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Japanese
 Yen (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">  59</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3,158</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Philippine
 Peso (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">  33</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,746</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,742</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,961</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11% to 24%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11% to 24%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">15.0%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Variable
 Rate</i></p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">U.S.
 Dollar (in millions)</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">143</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">117</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 562</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">29,806</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,679</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">28,127</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">562</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">29,806</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">.05% to 2.5% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Japanese
 Yen (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">  13</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 708</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">   9</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">482</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">103</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> 379</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">482</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill rate </p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>2,118</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>112,373</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>8,829</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>103,544</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>2,115</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>112,246</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Interest
 rate swap (fixed to floating)</i></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">U.S. Dollar (US$125 million)</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(30)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(1,569)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(30)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">(1,569)</p>
 </td>
 </tr>
 <tr>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Japanese Yen (JPY15,037 million)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Fixed Rate on US$ notional </p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Variable Rate on JPY notional</p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Fixed rate
financial instruments are subject to fair value interest rate risk while
floating rate financial instruments are subject to cash flow interest rate
risk.  </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">&nbsp;</h1>

<p style='margin-left:.25in;text-indent:0in' style="margin-top:0;margin-bottom:0">Repricing
of floating rate financial instruments is mostly done on intervals of three
months or six months.  Interest on fixed rate financial instruments is fixed
until maturity of instrument.  Financial instruments that are not subject to
interest rate risk were not included in the above tables.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">&nbsp;</h1>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Credit Risk</i></b></p>

<p style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">&nbsp;</h1>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We trade only with recognized, creditworthy third
parties.  It is our policy that all customers who wish to trade on credit terms
are subject to credit verification procedures.  In addition, receivable
balances are monitored on an ongoing basis to reduce our exposure to bad debts.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">With respect to credit risk arising from our financial
assets, which comprise cash and cash equivalents, trade and other receivables,
notes receivable and certain derivative instruments, our exposure to credit
risk arises from default of the counterparty, with a maximum exposure equal to
the carrying amount of these instruments.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We have
no significant concentrations of credit risk.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.25in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25. Reclassification of Accounts</b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Certain accounts in December 31, 2005 audited
consolidated financial statements were reclassified to conform with the June
30, 2006 unaudited consolidated financial statements presentation.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

</body>

</html>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
